Foreign Ministry spokesman Kong Quan made the remarks Tuesday when asked to comment on the first annual report presented to the US Congress by the US-China Security Review Commission.

He said the report, which is outdated and has a "Cold War mentality,'' groundlessly played up the myth of a "China threat'' and proposed an irresponsible trade and technology blockade against China.

The US-China Security Review Commission said in the report that US-China relations, frequently testy and tainted by mutual suspicion, suffered from an unco-ordinated approach among the branches of the US Government.

It recommended a tougher policy towards China, including possible limits on Beijing's access to US capital markets, restrictions on its US imports and increased reporting requirements for American companies doing business in China.

The reportedly 200-page commission's report was compiled by a panel of academics, officials, former government workers and academics.

The report's publication came three days after a Pentagon report on Chinese military power claimed Chinese mainland was increasing military pressure over Taiwan.

"If China becomes rich but not free, the United States may face a wealthy, powerful nation that could be hostile to our democratic values, to us, and in direct competition with us for influence in Asia and beyond,'' the report said.

Kong said China is a peace-loving country and China's development could only benefit world peace, stability and development, noting that Sino-US economic and trade relations had always been mutually beneficial.

"The development of Sino-US friendship and co-operation was the common aspiration of the two peoples,'' said Kong.

He stressed that any non-prejudiced and peace-loving people should not fear China's progress and the development of Sino-US relations.

China hopes that all Americans with insight have a clear view about the detrimental effects of the report, and oppose and resist false allegations in the report, Kong said.

(China Daily July 17, 2002)