BEIJING (AP) - Meeting for the first formal talks in nearly a decade, Taiwan and China agreed Thursday to set up permanent offices in each other's territory to coordinate continuing contacts.

The chairman of Taiwan's Straits Exchange Foundation said the Chinese side had proposed the idea first during talks Thursday morning in Beijing.

"Chairman Chen (Yunlin) proposed to have (a Chinese agency) to issue travel documents in Taiwan, and I agreed," Chiang Pin-kung told reporters in the capital. "I also hope there will be a similar Taiwanese agency serving Chinese people who plan to visit Taiwan."

Chiang didn't give details, saying the two sides still needed to discuss the issue.

The agreement came on the first day of talks between the foundation and its mainland counterpart, in the first formal talks between the sides since 1999.

The announcement injected a whiff of drama into an otherwise modest agenda that focused on finalizing agreements on charter flights and tourism.

Taiwan's delegation also discussed what additional help the island could provide for China's earthquake relief efforts. The talks are scheduled to run through Friday at a state guesthouse in western Beijing.

The 19-member Taiwanese team is being led by Chiang and includes two vice Cabinet ministers - the highest-ranking Taiwanese officials ever to participate in bilateral talks.

The negotiations should lay the foundation for "a long-term peaceful relationship between the two sides," Chiang said ahead of the talks. "The two sides have ... established mutual trust."

His counterpart, Chen Yunlin, head of Beijing's semiofficial Association for Relations Across the Taiwan Strait, said the public on both sides were counting on the talks to produce results and alter the often combative tone between the two governments.

"Whether cross-strait relations can improve, depends on whether our negotiations can proceed smoothly," Chen said.

Beijing's communist administration, which seized power on the mainland in 1949, considers Taiwan part of its territory and refuses to recognize the government in Taipei, which means that negotiations must be carried out by semiofficial bodies.

The sides set up the dialogue mechanism in the early 1990s, agreeing to set political differences aside in favor of boosting economic ties and private exchanges. China stepped away from talks a decade ago angered over steps by Taiwan to shore up its independent identity. Beijing insists the island is Chinese territory to be reunified with the mainland, by force if necessary.

While most Taiwanese oppose political union, many favor closer economic cooperation with the mainland, which has already absorbed more than US$100 billion in Taiwanese investment over the past 15 years.

Chiang's visit is seen as the first step toward fulfilling a pledge by newly elected Taiwanese President Ma Ying-jeou to reinvigorate Taiwan's economy, in part by hitching the island's wagon to China's economic juggernaut.

Foundation Secretary-General Kao Koong-Lian said that the two sides also reached an agreement on expanded charter flights and tourism in Thursday's talks.

"On July 4, we will have the first large group of mainland tourists visiting Taiwan to coincide with the kickoff of weekend charter flights," he said.

The accord opens the way for 36 charter flights to cross the 100-mile- (160-kilometer-) wide Taiwan Strait every weekend. Taiwan has banned direct scheduled flights since the 1949 division.

The expanded flights will be enough to shuttle several hundred thousand Chinese tourists to Taiwan every year - below Ma's target of 1 million, but far above the current level of about 80,000.

Charter flights are now limited to four annual Chinese holidays and are usually packed with Taiwanese residents on the mainland returning home to visit family. Ma wants to gradually expand the charter schedule and supplement it with regularly scheduled flights by the summer of 2009.

An agreement is expected to be signed Friday, after which Chiang was scheduled to meet with Chinese President Hu Jintao.