And while self-confessed China “Bull” Professor James Laurenceson admits he is the most pessimistic he has been over the past 25 years, he does see a bright outlook for Australia.
Appearing on the FINSIA Podcast, he said: “China has hit Australia with a an unprecedented campaign of trade disruption.
“China has disrupted trade with respect to other countries previously but it's been very targeted.
“Norwegian, salmon, Philippine bananas, but in the case of Australia, we've had a dozen goods hit with disruption and the value of those goods to China have fallen by about $20 billion.
“But the other thought to hold in mind is that in 2021, the total value of Australian exports to China actually hit a record high.
“That's for a few reasons, most prominently because China hasn't disrupted or exports and iron or export prices over the last couple years have been extremely buoyant.
“The big question is where we're headed since a new government arrived in Canberra. There hasn't been any relaxation of that disruption yet, but we've seen mild political easing. So it'll be an interesting six months ahead.”
Picking up on why he is so pessimistic, James - who is Director and Professor of the Australia-China Relations Institute at University of Technology Sydney - said: “I’ve been focused on the Chinese economy for 25 years and described as a China bull, pretty optimistic and upbeat about China's economic prospects.
“But I've got to say right now, I am more pessimistic about China's economic outlook, at least in the short term over the next six to 12 months than I ever have been before.
“There's a few reasons for that. In the second quarter, Chinese GDP was up just 0.4% on the same quarter in 2021 - basically not growing at all.”
While external trade in China had been buoyant over the first half of this year, domestic consumption has stalled because of the Chinese government’s Covid zero policy, which has seen restaurants and entertainment venues shut down on a regular basis.
“This is the first time ever, or at least over the last 30 years, where China’s real estate sector is actually contributing negatively to economic growth,” he added.
“Once China does open up again, it is certainly going to get a boost.
“It's also the case that foreign investment continues even today to pour into China.
“There are some sectors of China - particularly electric vehicles, industries of the future - where in fact the Chinese economy is going gang busters.
“Production of electric vehicles, or example, is up, 100% in July, on the same period previously. So, there's certainly some bright spots.”
Find out what other bright spots James is seeing in the economic outlook for China on the FINSIA podcast, which will be out next week.
More FINSIA Podcasts are available to download here.