Australia walked away from plans for a free trade agreement with Taiwan after China warned any deal would hurt relations between Beijing and Canberra.

Taiwan was on a list of economies the Coalition government was considering for bilateral trade deals but, in a series of meetings over 2017 and 2018, Chinese Foreign Minister Wang Yi conveyed directly to former foreign minister Julie Bishop that China was opposed to Australia boosting formal ties with the government of President Tsai Ing-wen.

"The Chinese government made it clear to me that circumstances had changed between Taiwan and mainland China and that China would not look favourably on Australia seeking to pursue a free trade agreement with Taiwan, as New Zealand had done some years ago," Ms Bishop told Fairfax Media.

Foreign ministers Julie Bishop and Wang Yi in Beijing in 2016. Credit:AP

Taiwan, a self-governed democracy of 23 million people, operates under de facto independence from China. The Chinese Communist Party – viewing the island as a renegade province that needs to be unified with the mainland – actively seeks to restrict Taiwan's international engagement and influence its domestic politics.