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President Hu Jintao's visit is a great honour for Australia and is of profound historic significance, the country's Governor-General Michael Jeffrey said yesterday. Hu arrived in Sydney yesterday for a three-day visit for the first time as president.

Jeffrey said he was glad to see that bilateral co-operation in various fields has progressed vigorously.

Chinese President Hu Jintao (C) stands with Australian Governor General Michael Jeffreys as they listen to the Australian national anthem being played upon his arrival at Sydney Airport October 22, 2003 at the start of his three-day visit to Australia. [Reuters]

Hu said he valued the economic and trade ties between the two nations.

And he said China and Australia should discuss ways of expanding those links using "strategic co-operation" in the field of energy as a starting point.

China awarded the North West Shelf Venture exclusive rights to supply liquefied natural gas (LNG) to China in a deal worth up to US$25 billion last year.

The LNG purchase, arguably Australia's biggest trade news story of the last decade, has reinvigorated bilateral trade relations.

On the trade front, China is now Australia's third largest partner and Australia ranks ninth on China's list.

Two-way trade grew by a fifth annually over the past five years and annual trade was in excess of US$10 billion in the past three years.

Hu's visit is likely to include a comprehensive bilateral framework agreement on trade and investment.

During yesterday's meeting with Jeffrey, the Chinese president said he looked forward to an "in depth" exchange of views with Australian friends from all walks of life on ways to further promote China-Australian relations.

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