Chinese Premier Wen Jiabao (R) meets with Kyrgyz President Kurmanbek Bakiyev in Beijing June 9, 2006. Bakiyev arrived here Friday afternoon for a two-day state visit to China. -Xinhua

China and Kyrgyzstan are in a position of taking a further step forward in bilateral relations, Chinese Premier Wen Jiabao said in Beijing Friday.

China and Kyrgyzstan have developed a sound foundation for advancing bilateral links, Wen said, noting that the two countries have sealed an agreement on the goals of cooperation in the next ten years.

Wen made the remarks during a meeting with Kyrgyz President Kurmanbek Bakiyev, who visited Beijing before the Shanghai Cooperation Organization (SCO) summit to be held in Shanghai next week.

During the meeting, Bakiyev emphasized the high degree of mutual trust between Kyrgyzstan and China, saying that bilateral relations do not have any problems.

Both Wen and Bakiyev emphasized the necessity to advance bilateral links in an all-round manner.

China has offered 900 million U.S. dollars worth of preferential loans to Kyrgyzstan and other SCO members.

Wen said the funding assistance and loans that China provides for Kyrgyzstan will be used on actual projects.

Bakiyev said Kyrgyzstan has already allocated the loans to specific projects. He expressed the wish that the two countries will strengthen cooperation on railway construction, mining, light industry, electricity, agriculture, investment and tourism.

Wen suggested the two countries step up cooperation on infrastructure development and further optimize trade structures.

Wen said the two countries should also actively carry out cultural exchanges to lay solid social foundation for bilateral links.

Wen said China and Kyrgyzstan should deepen cooperation in the fight against terrorism, separatism and extremism both at bilateral and multilateral levels within the SCO framework. The two countries should join hands to maintain security and stability of the region, Wen said.