A Chinese state-run newspaper accused Australia of spying on China and stealing its technology on Thursday, weeks after Beijing rejected allegations of interference in Australian politics.

An employee of China's national security department told the Global Times that Australian intelligence agents "in disguise" collect information from Chinese people overseas or "even encourage them to subvert China".

Agents also closely monitor Chinese people and the embassy in Australia to foil "Chinese spy threats", according to the article published on the newspaper's front page.

"In global covert struggles, Australia had never played the role of victim," the unidentified staffer was quoted as saying.

"However, they are wantonly working on intelligence about China and groundlessly accusing China of spying on them. The logic is ridiculous."

The Australian government did not immediately respond to the allegations.

The article follows an Australian media report this month that Australia's intelligence agencies had major concerns China was interfering in Australian institutions and using political donations to gain access.

An investigation by the Australian Broadcasting Corporation and Fairfax Media found the country's political elite had been warned two years ago about taking donations from two billionaires with links to the Chinese Communist Party.

But despite being cautioned by the nation's spy agency both the Liberal and Labor parties continued accepting substantial sums of cash.

The probe showed that property developers Huang Xiangmo and Chau Chak Wing, or their associates, had donated around AUS$6.7 million ($5 million) to political parties over a decade.

Following the report Canberra announced it had launched an inquiry into espionage laws and foreign government interference.

China's foreign ministry has called the reports "totally groundless" and said Australian media should not "waste their time on such meaningless and malicious" stories.

The Global Times article said many Chinese people have been interviewed or harassed by Australian intelligence and are required to provide information on Chinese communities and the embassy.

Some have been sent back to China to "gather information", the report said.

It also accused Australia of "stealing Chinese technology" and installing listening devices in China's embassy.

China's national security department could not be reached for comment as its phone number is not available to the public.

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