Chinese President Jiang Zemin arrived in Vietnam Wednesday for three days of talks with communist leaders on military and economic cooperation. The meetings also are expected to focus on adjusting communist theory to meet the demands of the global economy.

Hundreds of schoolchildren waving Chinese flags greeted President Jiang Zemin at Hanoi's airport Wednesday.

It is the Chinese leader's second visit to Vietnam since the two countries, which fought a border war in 1979, established diplomatic relations in 1991.

Mr. Jiang, who also leads China's ruling Communist Party, met with his Vietnamese counterparts, President Tran Duc Luong and Communist Party leader Nong Duc Manh.

The leaders signed an agreement for China to lend about $6 million to Vietnam for development projects. They also pledged greater technical cooperation.

Few other major agreements are expected from the talks, in part because President Jiang retires later this year. Still, the visit is expected to pave the way for greater military cooperation between the former enemies, as well as discussions on trade.

Regional experts also expect the two sides to discuss how to develop a private business sector within their communist state. Both China and Vietnam have introduced market reforms, but there is a debate on how far they should go.

One hot issue is whether to allow entrepreneurs to join the Communist Party. China has loosened the rules to allow capitalists to join the party, but Vietnam recently rejected a similar proposal as anti-socialist. Government insiders say the talks between two of the world's last communist states may turn into a "party to party" debate on how best to move forward in the new global economy.