BEIJING - Chinese President Hu Jintao hosted on Wednesday night a state banquet in honor of President Benigno Aquino at the Great Hall of the People.

Aquino was earlier given the welcome honors at the Great Hall, where he was received by President Hu.

During the bilateral meetings, the two leaders underscored the friendship between the two countries that has deep historical roots.

Trade dominated the bilateral talks of the two leaders, where it was agreed to increase trade and investments between the two countries.

Under the Philippine-China Five Year Development Program for Trade and Economic Cooperation, the two countries target to reach an annual amount of $60 billion in bilateral trade and at least $1.5 billion in total two-way direct investment by 2016.

South China Sea dispute

According to Presidential spokesperson Edwin Lacierda, President Aquino brought up the issue of the West Philippine Sea, stressing that differences should be resolved in a rules-based approach. Aquino described the problem as a regional one that requires a regional solution.

The Chinese side agreed that the problem should be solved peacefully, saying that the disputed area should be a zone of peace, friendship and cooperation.

“[President Aquino] mentioned that we have differences but these differences should not deter us from moving forward. The President also mentioned the position of PHL side that because this is a regional problem, it requires a regional solution. On the side of the Chinese, they also mentioned that they hold their consistent position that it should be resolved peacefully and that they would encourage that the South China Sea be developed as a sea of friendship, peace and cooperation,” Lacierda told reporters.

The possibility of having a joint oil exploration was not discussed between the two leaders.

'Reconfigure' Northrail project

Lacierda said China has also agreed to the proposal of President Aquino to "reconfigure" the Northrail project and have both sides resolve issues concerning it.

"The President mentioned that there were certain issues and that the Northrail project needed to be reconfigured. The Chinese agreed, they attach high importance to the project. Both sides selected their officials concerned with the project to resolve the Northrail issue," Lacierda said.

The President witnessed the signing of the signing and exchange of various agreements between the Philippines and China, with the (1) Philippine-China Five Year Development Program for Trade and Economic Cooperation on top of the agenda.

The two countries have identified 9 key areas for bilateral cooperation in the next five years: Agriculture and fishery, infrastructure and public works, mining, energy, information and communications technology, processing and manufacturing, tourism, engineering services and forestry.

Agreements signed

Another agreement signed is a (2) Memorandum of Understanding on Tourism Cooperation between the Philippines and China, where there will be an exchange of information, joint promotion of tourism of the two countries, tourism investment, language and cultural training, and support for tourism fairs and exhibitions.

There was also a (3) Memorandum of Understanding between the Presidential Communications Operations Office (PCOO) of the Philippines and the State Council Information Office (SCIO) of China for Friendly Exchanges and Cooperation. Here, both sides agree to facilitate exchange of visits of related officials and media practitioners, promote exchanges and cooperation between the media of the two countries, "encourage more comprehensive and objective media reports on important events and developments," and support "business exchanges and cooperation among newspapers, news agencies, radio and TV stations, publishing houses and internet media."

The 2 leaders also signed (4) a Memorandum of Understanding between the DFA and China’s Ministry of Foreign Affairs on Strengthening Cooperation targets to enhance the cooperation of the two ministries by having frequent contacts, regular consultations at various levels, conducting training programs, and cooperation in consular affairs; and (5) a Memorandum of Understanding on the assignment of a Chinese Ministry of Commerce investment officer to the China Desk of the Board of Investment "in order to assist the BOI in promoting the Philippines to Chinese investors," following a similar arrangement with Japan and Korea.

They also approved of an exchange of letters on (6) the extension of the executive program under the Philippines-China Cultural Agreement, and (7) a technical grant of 20 million RMB from the Chinese Ministry of Commerce for projects that will be endorsed by the National Economic and Development Authority (NEDA). The Chinese side is said to be considering the use of this grant for the Department of Agriculture's coco coir project.

There is also a (8) cooperation agreement between the People's Television Network and China's state-owned China Central Television or CCTV for an exchange of news programs, mutual licensing of news stories' copyright, and "establishment of a joint newsgathering scheme."

They also had an (9) agreement on sports cooperation.

Meantime, the agreement for the creation of the joint working committee to begin work on the Transfer of Sentenced Prisons Agreement between the Department of Justice and the Chinese Ministry of Justice was not signed Wednesday.