Germany and China held their first joint cabinet meeting Tuesday and were to ink billions in new business contracts, but Premier Wen Jiabao warned Europe against interfering in its internal affairs.

Wen arrived in Berlin late Monday from London where he and British Prime Minister David Cameron signed trade deals worth 1.6 billion euros while the Chinese premier brushed aside questions over Beijing's rights record.

Chancellor Angela Merkel, Wen and a total of 23 ministers were to sign 22 state cooperation pacts and deals worth "several billion euros," the German leader said.

While Berlin has rolled out the red carpet, starting with an informal dinner for Wen and his inner circle hosted by Merkel at a lakeside villa Monday, it insists it will not soft-pedal human rights concerns for the sake of commerce.

"We have different opinions on certain issues but I am confident we can discuss them," Merkel said at the dinner.

But Wen said Tuesday he would not accept lectures from European partners.

"China respects the political system and the development model chosen by the citizens of the EU," he told a conference of German and Chinese business leaders at a Berlin hotel.

"In exchange, we expect from the EU respect of our sovereignty, our territorial integrity and the autonomous choices of the Chinese people."

Germany welcomed the release of prominent Chinese dissident Hu Jia Sunday just days after outspoken artist Ai Weiwei returned home following nearly three months in police custody, amid a government crackdown on dissent.

Western nations including Germany had repeatedly urged Ai's immediate release. But Berlin has expressed serious concerns about apparent restrictions on Hu and Ai including their freedom to speak to the media.

Human Rights Watch urged Berlin to place the issue front-and-centre at the talks, saying that Ai's release showed "that political pressure on the Chinese government works."

While Merkel welcomed Wen to her chancellery with military honours, a few dozen demonstrators waved Tibetan flags and shouted "Freedom for Tibet!" in German.

Relations between China and Germany hit a low point in September 2007 when Merkel welcomed the Dalai Lama, Tibet's exiled spiritual leader whom Beijing brands a dangerous separatist.

Wen told reporters in London Monday that China would not accept "finger-wagging" over human rights.

The globe's number two economy, China, and number four, Germany, have seen trade volume rise by leaps and bounds in recent years, to hit a record 130 billion euros ($184 billion) in 2010.

Both sides hope to boost the figure to 200 billion euros annually by 2015.

The German-Chinese contracts, which both sides have agreed to keep under wraps until a press conference later Tuesday, are expected to involve cars, chemicals and aeronautics.

The 22 state cooperation pacts to be signed by 13 Chinese and 10 German ministers are to cover deepening cooperation in areas including climate protection, energy efficiency, food safety, education and the arts.

"We want to encourage (Chinese companies) to invest even more in Germany," Merkel told the business conference. "You are welcome."

But amid German firms' concerns about intellectual property rights and widespread piracy in China, Merkel underlined the need for "fair and reliable rules of play" between the two countries.

On the first leg of his three-nation European tour, Wen promised officials in Hungary that China would continue to support its faltering economy, and pledged to similarly aid the eurozone as it is rocked by a debt crisis.

The German official said the issue of China buying more government bonds from debt-wracked countries was certain to be discussed.

Analysts estimate that China has already bought more than 40 billion euros of European assets this year but this has done little to curb the crisis.

Beyond bilateral issues, Merkel and Wen were to discuss international hot spots including North Korea, Myanmar, Afghanistan, Pakistan, North Africa, Syria and Iran.

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