At Li's invitation, Merkel is making an official two-day visit to China beginning today. It is her eighth visit to China since 2005 in the capacity of chancellor.
Prior to the talks, Li held a red-carpet ceremony to welcome the German chancellor.
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Besides Beijing, Merkel will pay a visit to Anhui Province and Li's hometown Hefei.
Her visit to Hefei for this trip is not "unexpected," said Cui Hongjian, a researcher at the China Institute of International Studies and an expert on China-Europe relations.
Hefei is one of China's key science cities, with a heavy presence of the Chinese Academy of Science - a potential source of "intelligence support" for China and Germany's cooperation, Cui was quoted as saying by the state-run Xinhua news agency.
Anhui already has strong ties with Germany, with German tire giant Continental Tires investing 150 million euros (USD 160 million) in a factory in Hefei in 2011, the company's first Asian factory.
As an inland province, Anhui will play an important role in the future development of urbanisation and upgrading the manufacturing industry in China.
During her past seven visits, Merkel had visited six different cities outside the capital, including economic hubs Shanghai and Nanjing in the eastern coastal region, Xi'an and Chengdu in the vast relatively underdeveloped west, Guangzhou in the flourishing south and the northern harbor of Tianjin.
German Ambassador to China Michael Clauss says Merkel keeps "a very close friendship" with Chinese leaders, including Li.
The frequent China visits by the German chancellor in last decade show the close relationship between the two countries, Lu said, adding that there is greater potential for further cooperation.
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