Australian Prime Minister John Howard said Thursday in Sydney that Australia regards China as crucial to Australia's economic future as China is rising as a major customer to Australia's exports.

Howard made the remarks at a press conference on the eve of his visit to China next week, during which he and Chinese leaders are expected to announce the start of the bilateral free trade agreement negotiations.

Describing China as an "important trading, economic and political partner" of Australia, he said Australia has been seeking ways to further diversify and strengthen bilateral relationship.

His visit will focus on the full range of two country's relations including trade, economic issues and other important issues, especially further steps down the road towards China- Australia free trade, he said.

Howard said his visit is a "very significant" one and he will use this visit to further strengthen the already very valuable and important ties.

He reiterated Australia's One China policy, saying "we have One China policy and we encourage everybody involved to settle outstanding differences in a harmonious, amicable fashion."