Hu will be the first Asian leader to address Australia's parliament
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Chinese President Hu Jintao has been given a ceremonial welcome in Sydney at the start of his four-day visit to Australia, which is expected to focus on trade and regional security.
Mr Hu, who received a 21-gun salute, was greeted by Australian Prime Minister John Howard and also members of Sydney's Chinese large community, who waved Chinese and Australian flags.
The state visit was intended to "enhance friendship... deepen the co-operation and facilitate common prosperity" Mr Hu was quoted as saying by the AFP news agency.
The Chinese leader was also thanked by Mr Howard for playing a key role in attempts to defuse the crisis over North Korea's suspected nuclear weapons programme.
Mr Howard said the issue would be further discussed in talks later this week.
Trade deal
Later on Wednesday, Mr Hu is due to meet representatives of major Australian companies keen to do more business with China.
China is Australia's third largest trading partner, and the trade between the two nations has reached $15bn last year.
Earlier this week, the Australian Government said it was preparing to sign "a broad trade and economic framework agreement" with China on Friday.
Also on Friday, Mr Hu will become the first Asian leader to address a joint session of the Australian parliament in the capital, Canberra.
But correspondents say that Mr Hu's high-profile visit is also expected to be marked by protests from supporters of Tibet's independence and member of the Falun Gong spiritual movement, which is banned in China.
Mr Hu's visit coincides with a brief trip to Australia by US President George W Bush, but the two leaders are not scheduled to meet.