China has welcomed President Clinton's decision to renew the country's Most Favoured Nation trading status for another year.

A foreign ministry spokesman Zhu Bangzaosaid the special trading relationship provided tangible benefits for both countries.

But he urged Washington to grant China permanant favoured nation status, in order to stabilise long-term economic relations.

Announcing the decision on Wednesday, President Clinton said that trade was an important force for change, and the policy was clearly in the American national interest.

Correpondents say the decision is likely to face tough opposition in the US Congress.