subject verb agreement - 'Country have' vs 'country has'

1) Australia has won the World Cup Cricket.

2) Australia have won the World Cup Cricket.

Which sentence is correct? Also, I would like to know more contexts where 'country has' and 'country have' are used.

Answer

It depends on whether the speaker understands the team from Australia to be a plural or singular noun. I've answered this question in another context, here, but to reiterate:

"Many group nouns can take either take a singular or plural conjugation depending on the dialect of the speaker. These include things like band, group, and pair."

This use of Australia is metonymy, when a thing is referred to using a related noun that represents it. In this case, Australia represents the Australian team. A common use you may know is using "the White House" to mean the American government.

For something like metonymically referred-to countries, getting the actual values for which dialects use "are" or "is" is really hard, because there's no way to distinguish between meaning literally "the country of Australia" (which is always singular) and "the team/government/people of Australia" (which can be plural or singular).

In general, however, the UK and Ireland prefer "are" and the rest of the Commonwealth + America prefer "is" for nouns that can be plural or singular.

Here are a few examples of both usages:

Portugal have a great team on their hands. (i.e. the people of Portugal)
Sweden has passed a new law. (i.e. the Swedish government)
China have decided to withdraw from the treaty. (i.e. the Chinese government)
Rwanda has tied with Morocco. (i.e. the Rwandan team)