A Queensland family has described their shock and outrage over a local council's decision to paint over their children's artwork because it displayed the Taiwanese flag.

School students were asked by Rockhampton Regional Council to decorate bull statues with the flags of the students' home countries for the city's upcoming cattle industry expo, Beef Week. The initiative was intended to "celebrate the cultural diversity of the Rockhampton community," according to the plaque that accompanied the statue.

Two Taiwanese-born siblings at North Rockhampton High School had subsequently painted the flags of their country of birth.

But after the statue was erected in Rockhampton's CBD, the family of Amber Jun Xie and Iu Ting Xie discovered their flags had been painted over. While flags painted by their classmates which included Japan, Brazil and the United Kingdom remained intact.

The stepfather of the two students complained to Rockhampton Regional Council over the cover-up, accusing them of bowing to pressure from Chinese delegates due to visit the city for Beef Week.

“The Mayor said her hands are tied because of China’s One Nation Policy (One China Policy)," Lawrence Downing told SBS Mandarin.

"It's like a slap in the face [for the kids]."

Following an inquiry from the ABC, the council's department, Advance Rockhampton admitted to painting over the Taiwanese flag.

"Advance Rockhampton made a decision to change one bull statue on display in Quay Street in line with the Australian Government's approach of adhering to the one-China policy," general manager Tony Cullen told the ABC.

Amy Chen

"We highly value the relationship with all of our international trading partners and the opportunities they present for our region."

Mr Cullen further added that North Rockhampton High School had been advised of the changes prior to the council making them.

Mr Downing has demanded an apology from Advance Rockhampton to his children and claimed the council had taken the action to cover up the flags because of a complaint from a Chinese delegate. The council has not responded to this accusation.

The children's mother, Amy Chen, who was also born in Taiwan, said her homeland is an independent country and was angry with Rockhampton council's stance.

“Why should Australia follow China’s policy rather than Taiwan’s?” she told SBS Mandarin.

“We have our own flag which is 107 years old. We count on our own law and president. They are all independent. We receive no help from China. They are different and separated places.”

No tension between Rockhampton communities

Rockhampton's current incident is not a reflection of relations between the city's Chinese and Taiwanese communities, Mr Downing and Ms Chen told SBS Mandarin. Nor has it created any issue at school for their children.

“There’s no drama, mate, there’s no politics at the school," he said.

“Australia is multicultural, no matter where you come from, we can be friends,” Ms Chen added. “It won’t be affected by political issues between China and Taiwan.”

Dilemma of China-Taiwan relations

After China’s civil war decades ago, the exiled Chinese Nationalist government retreated to Taiwan and struggled to maintain control as the Republic of China and the Communist Party established a new country, the People’s Republic of China.

Since Taiwan lifted its Martial Law and initiated political democratisation in the 1980s, Taiwan's fight for independence has became more active. At last year's election, the Democratic Progressive Party exploded in popularity and took power.

According to Taiwan’s constitutional law, its formal name is Republic of China, its territory includes Mainland China and its national flag remains the same design as the one used in the Mainland decades ago.

Although Taiwan is widely seen as a separate political entity from Mainland China, Australian Government considers Taiwan as a part of China and has no formal diplomatic relations with the island.

The relationship between China and Taiwan has grown more hostile in recent days as Taiwanese leaders openly expressed their intention to establish a completely independent Taiwan state.

It is believed their move triggered China’s retaliatory measures around the globe to pressure private companies to obey One China Policy.