Australia’s lucrative international student sector appears set for a huge boost due to improving relations with China.

Government data shows Chinese student visa holders more than halved between 2019 and 2022, falling from 165,149 to 78,234 during the pandemic period.

China’s ambassador to Australia Xiao Qian said on Tuesday “bad political relations” had contributed to students’ reluctance to come to Australia but more stability in the relationship should see that trend reversed.

“Some Chinese students are not happy with the policies and then they might be hesitant to come to study,” he told reporters.

“Once we have an improvement (in the) relationship that absolutely is going to send messages to students you should have confidence about the future, you should have confidence about the relationship between the two countries, you should have confidence to come back to study in Australia.”

Mr Xiao said “absolutely extraordinary” policies for internation al students could also deter students from coming to Australia.

Student visa holders require approval from the Department of Home Affairs to switch courses and some require initial approval before they can begin a course.

“Some of the policies by the previous government, they have been a negative influence on Chinese students’ attitudes to come to study in this country,” Mr Xiao said.

“This is absolutely extraordinary … this is very much not a normal kind of practice in many other countries.”

Australia’s international student sector was valued at a cool $40 billion in 2019.

Employment and Workplace Relations Minister Tony Burke said the Labor government was approaching Chinese-Australian relations differently from its predecessors.

“So effectively, the refrain now is, you cooperate where you can, you disagree where you must, and you pursue the national interest,” he told Nine.

“Out of that we have seen a thawing of relationships , things are much better than they were twelve months ago.”

Prime Minister Anthony Albanese met with President Xi in November, making him the first Australian prime minister to meet with his Chinese counterpart since 2016.

This was followed by Foreign Minister Penny Wong’s trip to Beijing in December to discuss a range of thorny issues, including trade issues and the plight of two detained Australian citizens.

Source: AAP