Chinese Premier Li Keqiang (R) shakes hands with Australian Prime Minister Tony Abbott during the annual talks between the two countries' government leaders, in Sanya City, south China's Hainan Province, April 9, 2014. (Xinhua/Li Xueren)

China and Australia have agreed to accelerate negotiations on a bilateral free trade deal during annual talks between the two prime ministers.

"China hopes the two sides advance relevant negotiation in the spirit of mutual benefit, pragmatism and mutual accommodation, in efforts to score an balanced and high-level agreement," said Chinese Premier Li Keqiang.

China expects Australia to continue to provide a fair environment for Chinese investors, Li said, adding that China is ready to expand cooperation with Australia in trade, economy, investment, finance, education and defense.

"Currently cooperation in East Asia is facing opportunities and challenges," Li said, noting China will work with all parties to build regional peace, safeguard stability and promote development.

"To make Asia a driving force for the world economy, a peaceful and stable regional environment is needed," he said.

Australian Prime Minister Tony Abbott agreed to accelerate talks for the free trade deal, and expressed the will to expand cooperation in education, culture, security and military forces, so as to deepen bilateral relations and protect regional peace and stability.

Abbott also welcomed Chinese investment in Australia.

The two sides inked cooperative deals in finance, farming and animal husbandry.