Mutual trust is a precondition that ensures the smooth development of China-Australia ties, and the two countries should respect each other's core interest and major concerns, President Xi Jinping said when meeting with Australian Prime Minister Malcolm Turnbull on Sunday.

They met on the sidelines ahead of the G20 Leaders Summit in eastern China's Hangzhou city.

China and Australia are expected to further implement their bilateral free trade agreement, explore cooperation in fields such as energy and resources, agriculture and husbandry, food processing and infrastructure construction, Xi said.

Australia hopes to further provide a fair, transparent and understandable policy environment for foreign investors, which also serves the interest of Australia itself, Xi said.

The two countries should work on expanding joint research and development regarding fields such as food, agriculture, mining and oceanic science, and they should reinforce cooperation to fight corruption, find fugitives and illegal assets and fight terrorism, Xi added.

China is ready to reinforce coordination and collaboration with Australia through mechanisms such as the United Nations, G20, the Asia-Pacific Economic Cooperation, Xi said.

Turnbull said the two countries enjoy a long-standing friendship and the comprehensive strategic partnership enjoys widespread support within Australia.

The Australian side is dedicated to implementing the bilateral free trade agreement, is ready to deepen bilateral economic and trade relationship, and continues to welcome Chinese investment in Australia, Turnbull said.