The agreement is the first step in solving various territorial disputes in South China Sea. (File)

China and the Association of Southeast Asian Nations (Asean) have agreed on a draft code of conduct (COC) that will lay the foundation for talks over the disputed South China Sea, the Foreign Ministers of Singapore and China announced on Thursday.

The agreement came at the annual ministerial meeting between China and Asean member states in Singapore, Channel News Asia reported.

China has overlapping territorial and maritime claims in the South China Sea with several Asean members, including Brunei, Malaysia, the Philippines and Vietnam.

The countries have long discussed a deal to defuse tensions but the talks have been hindered by sticking points such as the area the agreement should cover.

Chinese State Councillor and Foreign Minister Wang Yi said the agreement on the draft was a new and important step for the code of conduct deliberations. "I believe that the negotiation on COC can be speeded up if we exclude external interference," he said.

"Facts will prove that China and Asean member states are capable of maintaining peace and stability in the South China Sea and reaching regional rules adhered to by all through negotiations."

Singaporean Foreign Affairs Minister Vivian Balakrishnan called the agreement a "milestone". He said the single draft negotiating text will be a "living document and the basis of future code of conduct negotiations". Both sides also agreed on the key modalities for future rounds of talks.

He also said that the agreement on a single text didn't mean that negotiations were over or that all the competing claims over territory in the South China Sea were resolved as the code of conduct "was never meant to resolve territorial disputes", according to the report.

Mr Balakrishnan added that it would be premature to set a deadline for the negotiations on the code of conduct as it involved a "dynamic, evolving situation".

Negotiations on the code of conduct began in March and both sides arrived at the first draft during talks held two months ago at China's Changsha city, said Balakrishnan.

The Chinese Foreign Minister said that Beijing dispatched its most advanced rescue ship equipped with professional search-and-rescue teams to the Nansha Islands (in South China Sea) days ago, to carry out various missions.

The ship will provide maritime assistance for ships from countries around the world when necessary, he said.