Many Asian countries have expressed concern about China over everything from its economy, which is rising at breakneck speed, to its inexpensively-made products and huge military spending.

But at the 16-country East Asia Summit, Wen insisted that China was rising in peace -- a formulation Beijing has repeatedly used in the past to calm concerns about its growing might on the international stage.

"China's relations with its neighbours are now in great shape," he said.

"China's policy of good-neighbourliness and friendship has served the common interests of all the countries concerned. This policy will remain unchanged."

Wen said his country has "embarked upon a sound path, the path of peaceful development. China pursues development through peaceful cooperation and endeavours to uphold world peace as it develops itself."

China and the Association of Southeast Asian Nations signed a landmark cooperation deal on Sunday to open market access in its lucrative services sectors -- a major step towards its goal of establishing a free-trade area with its Southeast Asian neighbours by 2010.

With China's economic and political influence in the region rising, Wen said it still needs friends in the region to meet its developmental goals.

China has long insisted that its rise poses no threat to other nations because it first needs to address a range of internal problems, such as strains on the environment and resources, and the wealth gap between urban and rural areas.

Wen said China's expanding economic power had helped contribute to stability in the region but many ordinary people were still living in poverty, and his nation needed to focus on improving their livelihoods.

The country "has a population of 1.3 billion and its per capita GDP is lower than 100th in the world," he said.

"In China, there is a serious imbalance between urban and rural areas," said Wen. "For many years to come, development will remain a top priority for us."

During his meetings with Asian leaders in the past few days, Wen repeatedly emphasised the importance of building political mutual trust, economic and trade ties as well as cooperation on energy and defence.

earlier related report
China's money supply registers 16.9 percent growth
Beijing (AFP) Jan 15 - China's broad M2 money supply, a key indicator of financial health, was up 16.9 percent at the end of December over the same period in 2005, the central bank said Monday.

China's M2 money supply, which includes cash in circulation and all deposits, reached 34.56 trillion yuan (4.4 trillion dollars) at the end of December, the People's Bank of China said on its website.

Year-on-year growth of the M2 supply in November registered 16.8 percent.

"The People's Bank of China ... has implemented a stable monetary policy and timely and appropriately adjusted credit, and achieved clear results," the bank said.

"During the year, financial operations have gone smoothly and effectively advanced a stable, balanced and rather fast development of the nation's economy."

The December figure was still above the central bank's M2 target growth rate for 2006 of 16 percent, but according to the bank was 0.63 percentage points lower than M2 growth in 2005.

The total amount of money issued in 2006 was 304.1 billion yuan, some 47.8 billion more than the amount issued in 2005, the bank said.

"Overall the increase in the money supply is basically the same as economic growth," the bank said.

The narrower M1 measure of money supply, which includes cash in circulation and corporate demand deposits, grew by 17.48 percent in December year-on-year, up from 16.8 percent year-on-year in November.

China's M0 money supply, which measures cash in circulation, was up 12.65 percent year-on-year in December, it added.

At the end of 2006, Chinese banks and financial institutes had 22.53 trillion yuan in outstanding loans, up 15 percent over the previous year, it said.

New loans issued in 2006 amounted to 3.18 trillion yuan, it said.

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