On the afternoon of May 17, 2005, President Hu Jintao met in the Great Hall of the People with Icelandic President Olafur Ragnar Grimsson who was paying a state visit to China. The two sides reached important consensus on further expanding bilateral reciprocal cooperation and promoting the sustained and in-depth development of bilateral friendly and cooperative relations.

Hu said since the establishment of diplomatic ties between China and Iceland, bilateral relations have witnessed remarkable progress. The two countries enjoy frequent top-level exchanges of visit, expanding economic and trade cooperation, positive results in the cooperation in other areas and wonderful cooperation in international affairs. China appreciates Iceland's adherence to the one-China policy and its support for China's reunification cause and positively appraises the fact that Iceland was among the first European countries to grant China full market economy status. China-Iceland relations have set a good example in building equality, friendship and reciprocal cooperation between countries with different social systems and economic development levels.

Grimsson said the leaders of the two countries have been long maintaining close exchanges and bilateral friendship and cooperation have kept deepening. This shows that under the new situation different countries can develop sound national relations on the basis of equality and mutual respect despite their differences. The Icelandic government firmly upholds the one-China policy and supports China's reunification cause.

Hu said in a bid to promote China-Iceland friendly and cooperative relations to a higher level, China would like to make joint efforts with Iceland to maintain the momentum of top-level exchanges of visit, enhance the exchanges and dialogues between the two governments, relevant departments, legislative bodies as well as political parties, and foster closer political relations between the two countries. Active efforts should be made to expand bilateral economic and trade cooperation on the basis of mutual benefits. Bilateral reciprocal cooperation in transportation, telecommunication, environmental protection and finance should be strengthened and two-way investment should be encouraged. We should launch the feasibility study of the establishment of China-Iceland free trade area, deepen bilateral exchanges and cooperation in humanities, encourage civil exchanges, actively implement the cooperative agreements that have been signed and jointly promote new achievements in the cooperation in these areas. China respects and supports Iceland's wish to play a bigger role in international affairs and would like to enhance bilateral consultation and coordination in international organizations and multilateral affairs.

Grimsson indicated that Iceland would like to continue to maintain top-level exchanges with China and enhance dialogues and exchanges at all levels. With the hope to become China's important trading partner, Iceland is willing to conduct cooperation in terrestrial heat, fishery, medical care, aviation, transportation, education and tourism and actively explore the possibility of establishing a free trade area with China.

Following the talks, the two heads of state attended the signing ceremony of four agreements including the Memorandum of Understanding on Environmental Protection and the Memorandum of Understanding on the Cooperation in Earthquake Research.

Prior to the talks, Hu held a welcoming ceremony for Grimsson upon his visit to China. Also present at the welcoming ceremony were President Hu's wife Liu Yongqing, Vice Chairman of the Standing Committee of the National People's Congress Cheng Siwei, State Councilor Tang Jiaxuan, Vice Chairman of the Chinese People's Political Consultative Conference Li Meng, Vice Chairman of the Central Committee of the Jiu San Society Hong Fuzeng, Minister of the State Environmental Protection Administration Xie Zhenhua and Chinese Ambassador to Iceland Wang Xinshi.