Clinton urges Falklands mediation for Britain and Argentina

After a two-hour meeting with Argentinian President Cristina Fernandez de Kirchner in Buenos Aires on Monday night, Ms Clinton said: "We would like to see Argentina and the United Kingdom sit down and resolve the issues between them across the table in a peaceful, productive way."

Ms Clinton did not respond to Ms Kirchner's request for US mediation, but said that Washington wanted to encourage both sides to talk.

"We will continue to encourage exactly the kind of discussion across the table that needs to take place," she said.

Argentina invaded the Falklands in 1982, prompting a war in which more than 600 Argentinian and 255 British military personnel died.

Britain keeps a military presence on the islands and the Falkland Islands administration - representing about 2,500 people - said that it supported British sovereignty.

The issue came to the fore again last week after a British oil rig started drilling in the North Falkland Basin - about 60 miles north of the islands.

Responding to Ms Clinton's comments, a spokesman for Prime Minister Gordon Brown said: "We welcome the support of the secretary of state in terms of ensuring that we continue to keep diplomatic channels open, but there is no need for direct involvement."

He argued that self-determination of islanders is the key issue and added that Britain believed the oil drilling was "both the right thing to do and entirely legitimate."

Argentina has always claimed sovereignty over the Falkland Islands, which sit off its coast but have been under British rule since 1833.