BEIJING (REUTERS) - Former Chinese president Jiang Zemin, who broke China out of diplomatic isolation in the post-Tiananmen era, has made a rare return to public life, saying that his country should not fear disputes with Washington and that honest dialogue is needed.

Ties between the world's two largest economies have been strained of late by US accusations of Chinese hacking attacks, and China's anger at revelations by fugitive former US spy agency contractor Edward Snowden of US electronic surveillance activities in China and Hong Kong.

Meeting in Shanghai with former US Secretary of State Henry Kissinger, Mr Jiang recalled the challenging time following the June 4, 1989 crackdown on pro-democracy demonstrators around Beijing's Tiananmen Square.

"After 1989 Sino-US relations certainly went through a difficult period, and then with the hard work of both sides, myself and President Clinton were able to visit each other," Mr Jiang said during the meeting on July 3, according to a statment issued on Monday by China's Foreign Ministry.

"My personal understanding is that although at present there are certain contradictions which exist between China and the United States, as long as our leaders have a frank exchange of views many problems can be resolved."

Mr Jiang visited the United States in 1993, four years after Tiananmen, despite Washington's anger at the crackdown.

Under Mr Jiang, China weathered the Asian financial crisis of the 1990s, joined the World Trade Organisation in 2001 and won the right to stage the 2008 Olympics in Beijing.

Mr Jiang said he was pleased that current Chinese leader Xi Jinping and US President Barack Obama had had such an honest exchange of opinions when they met in California last month, where cyber-security was a focus of the talks.

"This is extremely beneficial to developing bilateral relations," said Mr Jiang, who retired in 2002 and handed the reins to successor Hu Jintao in China's first bloodless leadership transition since the 1949 revolution.

Mr Jiang has remained influential while in retirement. He has returned to public life in a limited way since rumours swirled he was on his death bed in 2011, though he made a formal pledge to step back earlier this year.

Mr Jiang told Mr Kissinger that Mr Xi was a person of resolute character. Mr Xi owes his political rise to Mr Jiang, who marked him early on as a potential leader.

"As you know, a large country with 1.3 billion people like China needs a strong leader," added Mr Jiang, who said he had telephoned Mr Xi recently. "Xi Jinping is a wise leader who can really get things done.

"In such a large country, of course, there will be all sorts of problems. Problems are not scary: what is crucial is decisive action."