SYDNEY, AUSTRALIA - China's Vice-Premier Li Keqiang will arrive in Australia late on Thursday for a fence-mending visit following months of trade and diplomatic tension.

Li will touch down for talks with Mandarin-speaking Prime Minister Kevin Rudd seeking an upturn in relations which plummeted after China's arrest of Rio Tinto mining executive Stern Hu.

Analysts said Li's four-day visit was to repair ties after the flare-up over Hu, which followed Rio's snubbing of a major cash injection by a state-run Chinese firm.

"After the Stern Hu situation there was quite a lot of internal criticism of how it was handled," said John Lee, research fellow at Sydney's Center of Independent Studies.

"So this could be something of an ice-breaking visit without losing any face."

China's ambassador Zhang Junsai said after their difficulties, the key trading partners both realized they would have occasional differences.

"Both countries have come to a consensus that we have to manage the differences that naturally occur when we have such different histories and cultures and levels of development," he told The Australian.

Rio's rejection of aluminum giant Chinalco incensed Chinese media and was followed weeks later by Hu's arrest along with three Chinese colleagues in Shanghai.

Some Chinese attempts to buy into Australia's massive resources sector have hit trouble, although Yanzhou Coal won approval to take over Felix last week - subject to strict conditions.

But relations appear to have turned a corner with China's official Global Times printing an upbeat editorial this week.

"A promising economic and strategic blueprint is shaping up, as China deepens its diplomatic and economic cooperation with Australia, New Zealand and other Oceanian countries," the newspaper said.

"In the process, disputes, misunderstandings and conflicts of interest may well appear. But these situations can be mended as long as all parties adopt a principle of mutual respect and benefit.

"We should be alert for those few who try to destroy cooperation and stir trouble."

The visit by Li, widely tipped as Premier Wen Jiabao's successor, kicks off a three-nation mini-tour, including trips to New Zealand and resource-rich Papua New Guinea, concluding on November 5.

"It's going to facilitate better relations - it indicates that there's some degree of thawing in (Australia's) sometimes tense relations with China," said Queensland University's David Martin-Jones.