VIENNA, March 8 (Xinhuanet) -- China on Wednesday called for the continuation of diplomatic efforts to tackle the Iranian nuclear issue, saying there is still room for settlement within the framework of the International Atomic Energy Agency (IAEA).

    "China believes that the continuation of the diplomatic effortsremains the wise option for the solution of the Iranian nuclear issue," Zhang Yan, director of the Department of Arms Control of the Chinese Foreign Ministry, told the IAEA board members.

    He appealed for more time for diplomacy and asked for patience and restraint of all parties.

    "China appreciates and supports the diplomatic efforts of all parties and call on the international community to exercise patience and restraint in order to give more time to diplomatic efforts," he said.

    No parties should take steps that will exacerbate the contradictions, thus creating a more favorable atmosphere for diplomacy, he added.

    He asked Iran to observe all obligations that go with the nuclear Non-Proliferation Treaty and in particular to implement the relevant resolutions of the IAEA board.

    Iran should cooperate fully with the IAEA, increase transparency, take confidence-building measures, including in the area of uranium enrichment-related activities, so as to create theconditions for resolving the Iranian nuclear issue within the framework of the IAEA, he said.

    At the same time, China urged flexibility of all parties to find a solution that both ensures non-proliferation and Iran's rights to peaceful use of nuclear energy.

    In this regard, China believes that the Russian proposal for the transfer of uranium enrichment on Russian soil is worth a try.

    "The Iranian nuclear issue is at a critical juncture," said Zhang. There exist both a risk of deterioration and chances of improvement.

    "The key is whether all concerned parties choose dialogue instead of confrontation," he said.

    Zhang said China has taken note that the IAEA has not seen any diversion of Iran's declared nuclear materials to nuclear weapons or other nuclear explosive devices. "We have also taken note that the inspection is ongoing and there are certain pending issues."

    Zhang said China supports continued IAEA inspections and asks Iran to cooperate more actively.

    The IAEA board decided to report Iran's case to the UN SecurityCouncil on Feb. 4. This week's board meeting is seen to be crucialfor the next step.

    There are divisions among the 35 members of the board, with theUnited States and the EU3 -- Britain, France and Germany -- insisting that the UN Security Council should now take up the issue. Other countries, especially those of the Non-Aligned Movement, argue that the issue should be kept within the frameworkof the IAEA. Enditem