Chinese Premier Wen Jiabao and his Australian counterpart Julia Gillard on Tuesday agreed to further economic and trade cooperation, as the two major Asian-Pacific states aim to upgrade their bilateral ties.

"China and Australia share broad common interests in maintaining regional stability, promoting regional and world economic growth and coping with global challenges," Wen told Gillard, who is on her first official visit to China since taking office last June.

Following a red-carpet welcome ceremony, Wen hailed the sound development of bilateral relations including frequent high-level contact and substantial cooperation in various fields during their one-hour talks at the Great Hall of the People in downtown Beijing.

He urged the two states to enhance dialogue, mutual trust and cooperation, as well as promote the mutually beneficial, comprehensive and cooperative bilateral ties so to contribute to the harmony of the Asian-Pacific region and the world at large.

Wen proposed the two states establish "long-term and stable strategic cooperative ties" amid booming cooperation in the energy and natural resources sectors.

He also encouraged bilateral cooperation in the research, development and utilization of new, clean and renewable energy, as well as a new cooperation mode in the construction of information networks, rail and ports.

Wen urged the two states to steadily promote the ongoing Sino-Australian free trade talks, explore financial cooperation methods and expand cooperation in culture, education, science and technology and tourism.

Gillard voiced Australia's appreciation for China's assistance in the aftermath of last year's floods in the northeast Australian state of Queensland.

Australia will strive to further develop its comprehensive and cooperative ties with China on the basis of equality, mutual benefits and mutual respect, she said.

Gillard reiterated Australia's adherence to the one-China policy, pledged to further cooperation in economy, trade, energy and resources, investment, infrastructure construction, tourism, people-to-people exchange and cultural sectors.

Gillard also expressed her government's welcome to Chinese investors, students and tourists.

After their meeting, Gillard and Wen witnessed the signing of five cooperation agreements, which involve cooperation in science and technology, customs, tourism and service trade, and a 600-million-U.S. dollar deal on financing for an iron ore project of Western Australia's Karara Mining Ltd.

Gillard arrived in Beijing on Monday for a four-day official visit to China.