BEIJING (AP):

United States (US) Secretary of State Hillary Rodham-Clinton and Chinese officials say they will expand high-level talks on economic issues to include troubling security matters as well.

The two nations also agreed yesterday to cooperate in stabilising the global economy and combating climate change, putting aside long-standing concerns about human rights.

With the export-heavy Chinese economy reeling from the US downturn, Clinton sought, in meetings with Premier Wen Jiabao and other top Chinese government leaders, to reassure Beijing that its massive holdings of US Treasury notes and other government debt would remain a good investment.

"I appreciate greatly the Chinese government's continuing confidence in United States treasuries. I think that's a well-grounded confidence," Clinton told reporters at a joint news conference with Chinese Foreign Minister Yang Jiechi.

"We have every reason to believe that the United States and China will recover, and together we will help lead the world recovery," she said.

day of talks

After a day of talks on her first visit to China as America's top diplomat, Clinton and Yang said a regular high-level US-China dialogue on economic matters would be expanded to include security issues.

Details of the dialogue are to be finalised by President Barack Obama and Chinese President Hu Jintao when they meet at an economic summit in London, in early April, Clinton said.

Yang said China wants its foreign exchange reserves - the world's largest at $1.95 trillion - invested safely, with good value and liquidity. He said future decisions on using them would be based on those principles, but added that China wanted to continue to work with the US.

"I want to emphasise here that the facts speak louder than words. The fact is that China and the United States have conducted good cooperation, and we are ready to continue to talk with the US side," Yang said.

Beijing is the last and perhaps most important stop on Clinton's week-long visit to Japan, Indonesia, South Korea and China, on which she wanted to focus on the economy and global warming.

China last year surpassed the United States as the world's leading producer of greenhouse gases and Clinton said she and Chinese officials had agreed to develop clean-energy technology that would use renewable sources and safely store the dirty emissions from burning coal.

gas-fuelled power plant in Beijing

Visiting a new gas-fuelled power plant in Beijing, Clinton urged China not to repeat the "same mistakes" Western countries had made when they developed.

"When we were industrialising and growing, we didn't know any better," she said. "Neither did Europe. Now we are smart enough to figure out how to have the right kind of growth, sustainable growth, clean-energy driven growth. This plant could be a model."

Along with cooperating on the financial crisis and climate change, the United States wants China to step up efforts to address threats like Iran and North Korea's nuclear programmes and tenuous security situations in Afghanistan and Pakistan.

In addition, Clinton said the US would like to see China play a positive role in Myanmar and Sudan, two countries that receive large Chinese investments but whose governments are at odds with Washington.

The emphasis on the global economy, climate change and security highlight the growing importance of US-China relations, which have often soured over disagreements on human rights.

Authorities in Beijing are facing a difficult year on the rights front, as they deal with politically sensitive anniversaries: 20 years since the crushing of the Tiananmen Square democracy movement and 50 since the failed Tibetan uprising that forced the Dalai Lama to flee into exile.

Activists complained on Saturday that Chinese police were monitoring dissidents and had confined some to their homes during Clinton's two-day visit. Several of those targeted had signed 'Charter 08', an unusually open call for civil rights and political reforms that circulated in December, according to the China Human Rights Defenders.

China's poor human rights record

But ahead of her talks, Clinton signalled that China's poor human rights record, while still of deep concern to the US, would not be at the top of her agenda.

She noted both sides already knew the other's positions on the matter and said human rights concerns "can't interfere with the global economic crisis, the global climate change crisis and the security crises".

Her comments drew immediate fire from rights groups who said they sent the wrong message, undermined efforts to promote basic freedoms in China and squandered Washington's leverage with Beijing.

Asked to respond to the criticism, Clinton said "the promotion of human rights is an essential aspect of our global foreign policy", noting in particular the issues of Tibet, religious freedom and freedom of expression.

"Human rights are part of our comprehensive agenda," she said.

But she added that the work of civic groups and private advocates that she has highlighted is "at least as important in building respect for and making progress on human rights" as government-to-government contact.

Yang appeared pleased by Clinton's reply, saying China was happy to engage on human rights with the US but only "on the basis of equality and non-interference in each other's internal affairs".