Visiting Chinese Premier Zhu Rongji hold talks with Malaysian Prime Minister Mahathir bin Mohamad November 23 and both nations agreed to further strengthen their relations with more co-operation and high-level exchanges.

Zhu described the present Sino-Malaysian relations as being at the best stage since their diplomatic ties were established.

Malaysia has become China's very close friend in Southeast Asia. He said the momentum of frequent visits between leaders of the two countries have helped deepen mutual understanding, Zhu pointed out.

The Chinese Premier stressed collaboration in trade, economy, science, technology, culture, education and international affairs.

He said that the close political ties between China and Malaysia have set the stage for more trade and economic co-operation between the two countries.

Zhu expressed interest in Malaysia's Multimedia Super Corridor, a US$20 billion-40 billion project to establish a 750-square-kilometre information technology centre in Kuala Lumpur.

China will encourage its high-tech companies to take an active part in the project, said Zhu.

Mahathir held Malaysia's current relations with China in high regard and cited the joint statement issued six months ago when the two nations celebrated the 25th anniversary of the establishment of diplomatic relations.

Mahathir reiterated his country's adherence to the one-China policy. He also praised China for developing its economy with "a new way," which, Mahathir said, "has made China an influential and powerful part of the world economy."

The Malaysian Prime Minister thanked China for not devaluing its currency during the Asian financial crisis.

On international and regional issues of common interest, the two leaders were of the view that the major issue facing the East Asian region is to strengthen economic, financial, scientific and technological cooperation, which should be a key issue in the upcoming informal ASEAN summit, particularly by China, Japan and South Korea.

The two leaders also participated in the signing ceremony of three

documents. The two sides signed an agreement on cultural cooperation, a

memorandum of understanding between bank Negara Malaysia and the People's Bank of China, and an arrangement on the exchange of animals between the two countries.

Among ASEAN countries, Malaysia is China's second largest trading partner and investor. China ranks as Malaysia's 11th largest trading partner.