Chinese investment in Australia fell by 58 percent in 2019, despite the recording of a jump in bilateral trade, according to a new report by the University of Sydney and financial services giant KPMG.

The study's co-author, Professor Hans Hendrischke from the university's Business School and China Studies Centre, told Xinhua on Wednesday that the decline in Chinese investment had also been the case for other developed countries.

"Chinese outbound direct investment into all developed countries has decreased over the last three years after a big spike in 2015 and 2016," Hendrischke said.

"Australia was for some years during the mining investment boom the largest recipient country for Chinese outbound direct investment and then fell back to second place behind the U.S."

According to the report, in 2018, Chinese investment in Australia was worth 5.9 billion U.S. dollars, falling by 58 percent to 2.4 billion U.S. dollars in 2019.

Meanwhile, it stated that in the 2018-2019 financial year, bilateral trade between China and Australia was up 21 percent to a record 163 billion U.S. dollars.

The largest transaction in 2019 was Mengniu Dairy Company's acquisition of Bellamy's Australia for one billion U.S. dollars, accounting for 43.7 percent of the total Chinese investment.

The figures come from the report "Demystifying Chinese Investment in Australia" for June 2020, a joint effort by the University of Sydney and KPMG.

Head of Asia & International Markets at KPMG Australia and report co-author, Doug Ferguson, said that since 2008, Chinese companies have invested over 107 billion U.S. dollars into Australia – an important contributor to local economic growth.

With the global impact of COVID-19, the economic relationship between Australia and China stands at a particularly important juncture, with the potential to play a significant role in both countries' fortunes moving forward.

"When the economic recovery from the COVID-19 pandemic gains pace, Australia will be keen to expand domestic manufacturing. Developing new manufacturing in Australia will require investment capital on the one hand and demand for Australian manufactured products on the other," Hendrischke said.

"Australia's most immediate market opportunities are in China where Australian agribusiness and its products have a strong reputation. Cooperation with Chinese investors who have access to the Chinese market will be among the first opportunities for improving bilateral economic relations."

On Thursday, China responded to Australia's announcement that it will reform its foreign investment framework. The Chinese Commerce Ministry said that China will pay attention to and evaluate the impact of the reform. The country encourages those Chinese companies with the means to make legal and legitimate investments in Australia and urges them to abide by all applicable rules and regulations.