The Federal Government will spend $44 million to “turbo charge” Australia’s engagement with China.

The Prime Minister has appointed a fluent Mandarin speaker as its new ambassador to Beijing and announced the funding to set up the National Foundation for Australia-China Relations.

The new agency is designed to harness the power of the private sector, non-government and cultural organisations, state and federal agencies and the Chinese-Australian community “to turbo charge our national effort in engaging China”, Foreign Affairs Minister Marise Payne said.

Graham Fletcher has been given the ambassadorial role after having served three postings in China as an Australian diplomat and is fluent in Mandarin.

Mr Fletcher currently leads the Department of Foreign Affairs and Trade's north Asia division. He replaces outgoing ambassador Jan Adams, who has been in the post since 2016.

Labor says it supports the appointment of Mr Fletcher, but said it would like to have been consulted about the decision.

“Labor is supportive of the choice, but given proximity to the election it would have been appropriate for the Government to consult the Opposition,” a spokesperson for Shadow Minister for Foreign Affairs Penny Wong said.

“Given the importance of the relationship, that would have been the responsible thing to do.”

The $44 million foundation will replace the Australia-China Council, led by the current chair of the council, Warwick Smith.

The new foundation should keep the old council’s focus on education, culture and the arts.=, but with new funding it can also promote areas like agriculture, infrastructure, health and ageing, and the environment and energy.

“There are many areas where Australia and China share common objectives and where we can maximise mutual cooperation to the benefit of both countries,” Ms Payne said in a statement.

“We have different perspectives on some important issues and the new foundation will encourage and enable considerable constructive discourse and engagement between our two countries.”