Taipei  - Taiwan's parliament on Wednesday voted to allow the exchange of China's currency to facilitate a government plan to open the island for holiday visits by Chinese tourists, officials said.

"The revision of the cross-strait people relations act would provide the legal basis for the exchange of renminbi in Taiwan," said Lai Shin-yuan, chairwoman of the Mainland Affairs Council, the island's top China-policy-planning body.

Under the revision, which still needs a third and final review by parliament, each Chinese tourist would be allowed to exchange up to 20,000 renminbi (2,870 US dollars) into Taiwan dollars during his or her stay in Taiwan and change the unspent local dollars back to the Chinese currency at the end of the visit.

Chou Ah-ting, deputy governor of the central bank, said the restriction is due mainly to the absence of a currency-clearance system between the two sides of the Taiwan Strait.

He said Beijing and Taipei must hold talks and sign agreement before such a system could be established. Only then would non-restricted currency exchange be possible.

Taiwan and China have remained at loggerheads since the two sides split at the end of the Chinese Civil War in 1949. The island has barred direct official contacts with the mainland, but Taiwan's new government, headed by Ma Ying-jeou of the China-friendly Nationalist Party, or Kuomintang, has offered to mend fences with Beijing and launch weekend charter flights across the Taiwan Strait in July. It has also decided to allow Chinese tourists to visit the island staring in July. (dpa)