His gift, worth $26 million, will fund initially fund 30 scholarships at the University of Newcastle for Australian students when it begins in 2018.

Twenty of the students will receive support for the duration of their degree, including a $10,000 to $15,000 annual allowance as well as access to an engagement and enrichment program. Additionally 10 students will get one-off support for an internship or overseas exchange visit.

University of Newcastle vice-chancellor Caroline McMillen said there is a possibility the scholarship holders would be able to do internships with Alibaba in China or Australia.

She said the scholarships would also particularly focus on disadvantaged and Indigenous students. When fully up and running the Ma and Morley scholarships will benefit 90 students a year.

Jack Ma on a Sydney ferry on his first visit to Australia in 1985.

Mr Ma said he wanted the scholarships to "inspire, educate and cultivate tomorrow's leaders".

"Alibaba was built by young people and we are committed to lifting up and empowering students so they can reach their dreams and ambitions," he said.

Mr Morley died over a decade ago but his family was represented at Friday's scholarship announcement by his son David, a Newcastle yoga teacher who also first met Mr Ma in Hangzhou on the family trip to China in 1980.


He said the Morley family were very happy to see Mr Ma honouring their father's egalitarian values. (Mr Morley senior was a communist sympathiser and, ironically, his friendship with Mr Ma helped build one of the world's biggest e-commerce companies.)

Jack Ma and David Morley in Newcastle on Friday before the announcement of the $26 million donation. Peter Stoop

"Dad would be extremely proud of Jack's commitment to making a difference to students in our home town, and so touched that their close friendship has led to this program," Mr Morley said.

On Saturday, Mr Ma will open Alibaba's new local headquarters in Melbourne which will anchor its growing business in Australia and New Zealand.

Alibaba's Tmall Global offers overseas businesses access to the huge Chinese consumer market and Australia is reported to be the fifth-most active country on the platform.

Last year, Alibaba opened a data centre in Sydney, part of its strategy to match cloud computing leader Amazon Web Services in the next four years.