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WASHINGTON - US Treasury Secretary Henry Paulson said on Wednesday the United States and China agreed it was necessary for China to rebalance its economy to encourage more domestic spending and less reliance on exports.

"While we have much more work to do, we have tangible results for our efforts thus far," Paulson said in closing remarks after two days of talks on economic issues between top-level officials from the two countries.

Paulson said agreement had been reached on "significant items in financial services, energy and the environment and civil aviation."

Paulson and a Chinese delegation led by Chinese Vice Premier Wu Yi held two days of closed-door talks, the second leg of a "strategic economic dialogue" initiated last year.

Paulson has been urging China to rebalance its economy by encouraging more domestic consumption, which would have the effect of reducing Chinese savings and encouraging the import of more US-made goods.

"We agree that it is vital to the prosperity of both our nations, that China rebalance its economic growth, encourage consumption and spread development more broadly among its people," Paulson said in his brief statement.

He said the agreements on civil aviation and other areas were "signposts on the long-term strategic road" that will build confidence that the United States and China are on the right track in their dealings with one another.

He described his and Wu's function as being to "iron out differences and keep the economic relationship on an even keel, even during times of tension."

Congress is angry with China over rising US deficits on trade with the Asian export giant and Wu is scheduled to meet several members of Congress over the next two days. She will also meet with President George W. Bush on Thursday at the White House.