A rapid worsening of Sino-Australian relations in 1996 provided the new Coalition government in Canberra with a clear practical demonstration of the importance of China. China's irritation with Australia had increased in March when an Australian government statement expressed support for the U.S. intervention in the Taiwan Strait crisis. In June 1996, Chinese Minister for Trade Wu Yi expressed "strong concern" over Australia's sudden decision to discontinue its Development Import Finance Facility (DIFF) aid program. China was one of several Asian nations with joint projects that were jeopardized by the DIFF cancellation. China's annoyance with Australia increased in July 1996 after Australia voiced concerns over the fate of democracy and human rights in a post-handover Hong Kong and over China's July nuclear test on the eve of a testing moratorium. Australian Defense Minister Ian McLachlan suggested that China's actions during the Taiwan Strait crisis, its claims in the South China Sea, and its "newly assertive international posture" were destablizing to the region.
Asian Perspectives on the Challenges of China: Papers from the Asia-Pacific Symposium, March 7 and 8, 2000, p.57-66