Australia’s ruling government will now have the power to veto any deal struck between local authorities and foreign governments, after local lawmakers approved the legislation on Thursday.

“Australia’s policies and plans, the rules that we make for our country are made here in Australia according to our needs and our interests,” Australia’s Prime Minister Scott Morrison told reporters in Canberra.

While Morrison has stressed the new law is not aimed at any one country, it is widely seen by analysts as directed towards China, and the new legislation threatens to further sour Canberra’s ties with Beijing.

Under the terms of the new law, Australia’s foreign minister can veto agreements made by local institutions if they “adversely affect Australia’s foreign relations” or are “inconsistent with Australian foreign policy”.

Relations between Australia and its largest trading partner have become increasingly strained, with Australia angering China by calling for an international investigation into the origins of the coronavirus and blocking a recent agricultural deal.