Pope Benedict this morning decried Chinese state restrictions on religious freedom that "suffocate" the Church and sow division amongst that country's Catholics, in his most significant address on China to date.
But the Pontiff also extended an olive branch to Beijing, saying he hoped to strike an agreement with officially atheist China, where millions of Catholics worship under a state-controlled church that does not recognise his authority.
Others worship in "underground" churches loyal to the Holy See.
"It is true that in recent years the Church has enjoyed greater religious freedom than in the past," the Pope said.
"Nevertheless, it cannot be denied that grave limitations remain that touch the heart of the faith and that, to a certain degree, suffocate pastoral activity."
China has had no diplomatic ties with the Vatican since 1951, two years after the Communist takeover, something the Pope said he wanted to change.
"The Holy See remains open to negotiations, so necessary if the difficulties of the present time are to be overcome," the Pope wrote.
Although the Vatican estimated there are only between 8 million and 12 million Catholics in China, the Pope expressed hope that it would prove fertile ground for evangelisation in the future.
"During the first Christian millennium the Cross was planted in Europe and during the second in the American continent and in Africa," the German-born Pope wrote, in a letter addressed to China's bishops, priests and faithful.
"During the third millennium a great harvest of faith will be reaped in the vast and vibrant Asian continent."
Tensions have repeatedly flared over the appointment of bishops. China refuses to allow the Vatican to appoint them, saying this would be interference in its internal affairs.
But the Pope said the ability to appoint bishops is a fundamental part of the ability to fully "exercise ... the right of religious freedom".
He also said bishops appointed without Church approval were "illegitimate".