The ANU report is broadly in line with estimates by KPMG and the University of Sydney, which showed investment in Australia fell by more than half in 2019 was set for further declines this year due to the pandemic and heightened Australian scrutiny of Chinese investment.
The steep fall far outpaced a global decline in China's overseas ventures of 9.8 percent past year, reflecting the bilateral political tensions.
Chinese investment in Australia nearly halved in 2019, new data released today showed, as relations between the two countries deteriorated.
Chinese investment to Australia roughly halved in 2019 on a shift toward investment in emerging markets and negative perceptions in China of doing business with Australia, a report said on Sunday.
The incident, involving four Chinese state media journalists, was revealed by China's foreign ministry this week, in the wake of two Australian journalists departing China after questioning by Chinese police.
Trade Minister Simon Birmingham said the Australian security agencies had acted according to the law. In 2018, Canberra barred mobile technology maker Huawei Technologies Co Ltd from joining the rollout of the nation's 5G network.
In June, Australia announced tougher measures to block or overturn new foreign investments deemed to compromise national security - a move widely viewed as an effort to limit growing Chinese influence.
Relations between the two countries have become increasingly fraught over a host of issues ranging from Australian accusations of Chinese meddling in domestic affairs to trade disputes and calls by Canberra for an worldwide enquiry into the origins of the novel coronavirus.
China has imposed trade restrictions on products including barley and wine, prompting Australia to tighten national security tests for foreign investment.
Professor Peter Drysdale, who led the University economic research, said: "In the last few years, clearly Chinese investors have found the investment environment in Australia less certain and have been more cautious about undertaking investment in Australia".
The academic said structural changes were also partly to blame, with Chinese investors retreating from mining and resources as the commodity boom weakened.
He added: "Whether that can be changed quickly or not is another question altogether because it very much depends on how purposeful approach there is to mending the relationship between the two countries".