Chinese President Hu Jintao arrived Sunday in Costa Rica in the highest-level visit by a Chinese official to the country, just over a year after it gave up six decades of ties with Taiwan.

China has increased diplomacy and investment in Latin America in recent years, with an eye on its natural resources and developing markets for manufactured goods and even arms.

Hu and Costa Rican President Oscar Arias, who traveled to China last year, are expected Monday to announce the start of talks for a joint free trade accord, which could be signed in 2010. They are also due to sign 11 cooperation deals.

`The free trade agreement is very important for China, considering the strategic importance of Costa Rica for both the Caribbean and Central America,` Wang Xiaoyuan, the Chinese ambassador here, told AFP.

Costa Rica broke off more than 60 years of relations with Taiwan when it became the first Central American country to begin diplomatic ties with China on June 1, 2007.

It would be the third Latin American country to negotiate a free trade deal with China, after Chile and Peru, which has not yet concluded its accord.

Costa Rica, a major exporter of computer components, has dismissed fears of an invasion of Chinese products into the country of some four million people.

The trade balance has favored Costa Rica up until now, with 803 million dollars of exports up to September this year, compared with 671 million dollars of Chinese imports. China, however, deals in a much more diverse range of products.

Both Taiwan -- a democratic self-ruled island that Beijing considers part of its territory awaiting reunification -- and China have been accused of using so-called `dollar diplomacy` to get nations to ally with them.

But Taiwan has seen its allies fall over the years.

`It`s more than just symbolic that Hu Jintao has decided to come, because it is clearly making the point that it is no longer a Taiwanese stronghold,` said Costa Rican analyst Luis Guillermo Solis.

Part of China`s incentives for Costa Rica`s recognition came from its enormous foreign exchange reserves with an offer to buy 300 million dollars in bonds. It also donated 73 million dollars to build a new national stadium.

As Costa Rica prepares to sign new trade ties with China, analysts wonder if its Central American neighbors will be tempted to follow its diplomatic move.

China seeks to `develop relations with all these countries,` the Chinese ambassador said.

Hu arrived in San Jose from a G20 summit in Washington, with scores of businessmen and Communist Party officials, and will next travel to Cuba, late Monday, before attending an Asia-Pacific summit in Peru on November 22.

China and Cuba have remained all-weather friends for decades, their Marxist Socialist past a driving force in relations. China was Cuba`s second business partner, after Venezuela, in 2007.