Chinese Premier Wen Jiabao and Icelandic President Olafur Ragnar Grimsson hailed bilateral political and economic ties and vowed to further cooperation during their meeting in Beijing Wednesday.

Chinese Premier Wen Jiabao (R) shakes hands with visiting Icelandic President Olafur Ragnar Grimsson during a meeting in the Great Hall of the People in Beijing, capital of China, May 18, 2005.

Premier Wen told President Grimsson, who is here for a week- long state visit as guest of Chinese President Hu Jintao, that the geographic distance, social mechanisms, historic and cultural differences did not hamper the development of Sino-Icelandic relations.

"Since we forged our diplomatic ties 30 years ago, the Sino- Icelandic friendly cooperation has proved that countries with different social system and economic situation can reach peaceful coexistence and be mutually beneficial," Wen said.

The Chinese premier said that Sino-Icelandic economic and trade cooperation have great potential. Iceland's recognition of China's market economy status and the launch of feasibility study on forging a Sino-Icelandic free trade area will enhance economic ties.

He said he hopes that the two countries can further expand economic and trade cooperation by capitalizing on a Sino-Icelandic joint economic cooperation committee.

Grimsson said his trip to China yielded positive fruits and Iceland is confident and will further strive to push forward relations with China.

This is Grimsson's first China visit since he took office as president in August 1996. Besides Beijing, the 62-year-old president will also travel to Shanghai and east China's Shandong Province.

Source: Xinhua