Chinese President Xi Jinping (right) is escorted by Mongolian President Tsakhiagiin Elbegdorj (2nd left) at the welcoming ceremony in Ulan Bator during Xi's visit to Mongolia on Thursday. Photo: AFP

China and Mongolia have stepped up bilateral relations to a comprehensive strategic partnership as Chinese President Xi Jinping Thursday embarked on a historic visit to Mongolia.

During the first day of Xi's two-day state visit, the Chinese president signed a joint declaration with his Mongolian counterpart Tsakhiagiin Elbegdorj in Ulan Bator.

Xi also proposed to expand China-Mongolia trade to $10 billion by 2020, allowed the opening of northern and northeastern China's seaports to the landlocked neighbor and supported Mongolia's bid for joining APEC.

It was the first visit to Mongolia by a Chinese head of state in 11 years and only the second time that Xi has made a solo presidential trip to a foreign country since he took office in March 2013, a rare gesture that signals Mongolia's geopolitical importance to China.

Xi said China and Mongolia will boost cooperation in politics and security and invited Elbegdorj to attend the APEC meeting in Beijing in November.

"China will continue providing convenience to Mongolia in areas such as cross-border transportation and access to ports. China will work with Mongolia to facilitate cross-border transportation between Asia and Europe and together we will build the Silk Road Economic Belt," Xi said, adding that collaboration in mineral product processing, new energy, electricity and animal husbandry will also be strengthened.

Rich in mineral resources, a big part of Mongolia's export revenue depends on coal exportation and Mongolia has been actively seeking more access to Chinese ports to expand its overseas market.

Mongolia will be allowed to use sea ports in northern and northeastern China that are open to foreign vessels, a major breakthrough as China currently only allows Mongolia to use the port of Tianjin to trade its goods with other countries in the Asia-Pacific region.

International and multilateral cooperation is another key point in Xi's visit. Xi said both sides will continue working with each other in the UN, the Asia-Europe Meeting, the Shanghai Cooperation Organization as well as the Conference on Interaction and Confidence Building Measures in Asia.

"China supports Mongolia's decision to join APEC, supports the Ulan Bator Dialogue on Northeast Asian Security and the proposal of a trilateral summit between China, Mongolia and Russia," Xi said.

Elbegdorj said the comprehensive strategic partnership signals that relations between China and Mongolia have entered their all-time best.

"Mongolia has always supported China in its stances regarding the questions of Taiwan and Tibet. Mongolia does not support any group or activity that aim at splitting China," Elbegdorj said.

According to Japan's Mainichi Shimbun, Mongolia has canceled a scheduled visit by the Dalai Lama in August.

Several government officials, including Tsagaan Puntsag, chief of staff of the Office of the President of Mongolia, and Jigjid Rentsendoo, state secretary of Mongolia's Ministry of Mining, have called Xi's visit historic in previous interviews.

"Chinese leaders are pragmatic people. I believe together we can push bilateral cooperation to a higher level," Puntsag told the Global Times.

His remarks were echoed by Gombosuren Tserenpiliin, former foreign minister of Mongolia and former Mongolian ambassador to China, who told the Global Times that he respects China's long history and admires Deng Xiaoping's policy.

"We hope China could develop with stability. Disturbance in China will inevitably take its toll on Mongolia," he said.

Xi's trip came roughly two weeks ahead of Russian President Vladimir Putin's visit to Mongolia in early September.

Bordered by Russia to the north and China to the south, Mongolia is landlocked and is the only country in the world sandwiched between two world powers.

Mongolia has always been careful in maintaining balance between its two neighbors. To diversify its diplomacy, it has adopted a Third Neighbor Policy where the country seeks to develop relations with countries like the US and Japan.

Xi is scheduled to deliver a speech at the State Great Hural of Mongolia, the country's parliament, on Friday.

Bilateral trade between China and Mongolia stood at only $324 million in 2002, and has rocketed to nearly $6 billion in 2013, accounting for more than half of Mongolia's total foreign trade.