The Chinese Government has rejected allegations that Catholic priests have been subjected to sexual blackmail in an effort to persuade them to renounce their faith.

Officials denounced a report by the Vatican news agency, Fides, as irresponsible and said that the authorities knew nothing of such a case.

The Vatican agency has accused the Chinese authorities of setting up a detention unit in the northern province of Hebei, in which priests are tempted into "engaging in sexual relations" with prostitutes.

This marks an unusually bold allegation from the Vatican, which has been eager to renew diplomatic relations with China.

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It's an extraordinarily salacious story for the Vatican to be reporting. The official missionary service of the Vatican says it has evidence of "brainwashing" tactics involving physical and psychological torture.

It cites the example of Father Li Qinghua, who it says, was arrested last November. The report alleges that he, like many other Catholic priests, has been subjected to the attentions of a "Female Personnel Unit" who are actually prostitutes and tempt priests into sexual actions which, it says, are video-taped.

For their part, the Chinese authorities have reacted with disdain and bemusement. A government spokesman said there was no information on such a case. Police authorities in Hebei also denied any knowledge of a "special unit" but said they would look into it.

Two churches

Meanwhile one expert on the church in China said the report seemed bizarre, but possible. There are recorded incidents of blackmailing priests to provide information on the underground church and change their allegiances.

China has two Catholic Churches. The official state-sponsored Catholic Patriotic Association, which numbers between three and four million and the outlawed underground Catholic Church.

It has between eight and 10 million followers who remain loyal to the Pope. China broke off diplomatic relations with the Vatican in 1957 and has kept religion under tight control.

It appoints its own bishops and has periodically clamped down on believers outside its remit. During the Cultural Revolution in the 1960s and 1970s, priests were often forced to marry.

Anger at 'interference'

Despite the odd mention of progress in China on the issue of religious freedom, human rights reports continue to paint a bleak picture.

China, which has been eager to improve its image on human rights, is likely to be furious at this latest assault.

It regards such reports as interference in its own internal affairs and insists that it does not persecute priests for their beliefs, it only punishes illegal activities.

The Vatican has traditionally taken a back-room diplomacy approach to relations with China. But now it seems to have changed gear.

China's refusal last year to grant visas to two bishops to attend a large conference in Rome caused anger. China continues to smart over the Vatican's recognition of Taiwan, which it regards as a renegade province.