"Guinea is a country with traditional friendship with China and for years there has been smooth progress in cooperation between the two sides," foreign ministry spokesman Ma Zhaoxu told journalists.

"Our cooperation is based on equality and mutual benefit and is in line with international norms and with the fundamental interests of both peoples."

Ma was responding to reports that Guinea's regime, which took power in a December coup, was in talks with a Chinese firm that could bring in billions of dollars of financing for infrastructure, mining projects and oil prospecting.

According to the Financial Times, the Hong Kong-based China International Fund (CIF) could pump seven billion dollars into projects ranging from the creation of an airline to power generation.

The deals would be among the largest of their kind in Africa, the newspaper said.

Ma refused to confirm or deny the deal, saying only that CIF was an enterprise registered in Hong Kong.

The newspaper said the deal could potentially pitch China against Western interests at a time of growing competition for Africa's natural resources.

China is accused by the West of disregarding human rights concerns in its drive to secure natural resources from African states, including from regimes such as the one in Sudan.

Guinea's opposition leader Sidya Toure, prime minister from 1996 to 1999, said: "I do not understand how you can believe that we can inject this kind of money into the economy of Guinea where the total gross domestic product is only three billion dollars."

A military junta took power in the small west African country in December and earned international condemnation last month for a bloody crackdown on opposition supporters.

United Nations officials and human rights groups say more than 150 people were killed on September 28 when Guinean troops opened fire on an unarmed crowd gathered in a stadium in Conakry to protest against military leader Captain Moussa Dadis Camara's rule.