The Taiwan authority started issuing passports on Monday with "Taiwan" printed on the cover, instead of the original "Republic of China," claiming that this was to avoid confusion with passport holders from the mainland.

Kong warned at a regular briefing that this was an illustration of the Taiwan authority's attempt to seek "gradual independence" and will further damage cross-Straits relations.

"Such an interpretation is unacceptable," Kong said.

Speaking ahead of today's meeting between Premier Wen Jiabao and US Treasury Secretary John Snow, where the renminbi exchange rate issue is expected to be discussed, Kong said China will maintain the stability of its currency,.

"China will continue to maintain the stable situation of its foreign exchange rate," Kong said.

"The stable exchange rate of the renminbi is conducive to the economic stability and development of China, Asia and the world," he added.

Vice-Premier Huang Ju met Snow yesterday talking on China's economic and financial development and bilateral trade and economic cooperation.

China has adopted a regulated, floating exchange rate mechanism based on market supply and demand since 1994, Kong said.

The mechanism will be improved in line with the country's development, he added.

International Monetary Fund managing director Horst Kohler said in Beijing yesterday that he agreed with China's caution on the issue of adjusting the international exchange rate of China's currency.

He also urged the international community to remember the contribution that China's exchange rate policy made to the regional and world economy during the Asian financial crisis.

Turning to the Korean nuclear issue, the spokesman said "Considering that the six-party talks in Beijing achieved some progress and the parties concerned reached certain consensus, China thinks that the UN Security Council should take a discreet attitude toward getting involved (in the Korean nuclear issue) at the current time."

When asked whether China felt disappointed with the remarks made by the Democratic People's Republic of Korea (DPRK) recently on the six-party talks, Kong said "China has no reason whatsoever to feel disappointed".

As an Asian nation, a permanent member of the UN Security Council and also a large developing country, China hopes to make its due contribution to peace in Asia as well as in the world at large, Kong said.

He noted that China has been making unremitting efforts to resolve the Korean nuclear issue ever since it emerged.

"China's efforts have won the full affirmation of the international community and the other five parties attending the six-nation talks in Beijing," he said.

Kong appealed to all parties to abide by the consensus reached at the three-day talks and refrain from taking any measures that might complicate or inflame the issue more.

He also called for the parties to maintain communication and close contact and study the other parties' stances very carefully so as to make preparations for the next round of talks.

Regarding the timing of the second round of talks, Kong said that it could not be settled now. As for whether the next talks would be held in Beijing, he said China's attitude toward that was "flexible and open".

"As long as the suggestion is conducive to resolving the Korean nuclear issue peacefully, China will actively take it into consideration," he said.

All the six parties need to take some time to study the other sides' positions after the talks so as to make policies for the next step, Kong said.

He said that China hopes each party could proceed from the peace and stability in Asia and the world and stay on the track of solving the nuclear issue through dialogue and diplomatic channels to continue making efforts.

The significance of the Beijing six-party talks, Kong acknowledged, is that the parties concerned sat together, and held discussions on the Korean nuclear issue.

The talks could help increase mutual understanding and lay down a foundation for reducing disputes and broadening consensus in the future, he said.

"China is fully aware of the intricacies of the Korean nuclear issue and the twists and turns and difficulties in continuing the talks," Kong said.

"But we believe the six parties all have one consensus, which is the hope that the talks will continue, mutual understanding will be deepened, suspicion will be reduced, consensus will be broadened and a peaceful solution to the Korean nuclear issue could be reached eventually," the spokesman said.
 
In response to a question on the Dalai Lama, Kong said the door for Dalai Lama to contact the central government is open as long as he abandons his separatist activities and acknowledges that Tibet and Taiwan are inalienable parts of China.

When asked to comment on the report that Japan will offer money to victims of the gas leak in Qiqihar in northeast China's Heilongjiang Province as a token of sympathy, Kong said China has been in consultation with Japan over this issue and has urged Japan for a proper and early settlement.

The gas leak which occurred on August 4 left over 40 victims, including one death.

Li Guizhen, a 31-year-old construction worker died last month from sustained serious burns caused by highly toxic mustard gas leak which was traced to chemical weapons left behind by invading Japanese troops during World War II.

In response to a question regarding the Libya issue, the spokesman said China hopes the United Nations will remove its sanctions on Libya at an early date.

Kong said the people of Libya have suffered from the sanctions and China hopes the related issues for lifting them will be settled at an early date.