China and the US must avoid a "new cold war" in their relations, China's top newspaper the People's Daily, said yesterday, in the wake of talks in Beijing between senior leaders of the world's two largest economies.

China and the US agreed on Thursday to boost military ties and counter-terrorism co-operation during annual talks in Beijing, but there was little sign of progress on cyber-security or maritime issues.

"China and the US realise that today's world has already undergone profound changes, and there is no longer a market for a 'new cold war',"the communist party paper said.

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