A secretive 2018 agreement between Beijing and the Vatican was renewed Thursday, despite strident US condemnation and warnings from underground Chinese priests loyal to Rome that they have only become more marginalised since it was signed.

The deal allows both Beijing and the Holy See a say in appointing bishops in an attempt to close a schism in China's 12-million-strong Catholic community.

Washington had put intense pressure on the Vatican to scrap the agreement, saying it has failed to shield Chinese Catholics from persecution.

"After friendly consultations," both sides agreed to the extension "for two years", foreign ministry spokesman Zhao Lijian told reporters on Thursday.

"The two sides will maintain close communication and consultation, and continue to push forward the process of improving relations."

Confirming the renewal, the Vatican said in a statement that the accord had had a "positive impact," although a commentary in the Holy See's official newspaper acknowledged "many situations of great suffering" in China.

"The Holy See is deeply aware of this, takes it into account and does not fail to draw the attention of the Chinese government to encourage a more fruitful exercise of religious freedom," it said.

Newly communist China severed ties with the Holy See in 1951, forcing Catholics to choose between membership of the state-run Chinese Catholic Patriotic Association or non-sanctioned churches loyal to the Pope.

The Communist Party is officially atheist and exercises strict control over all recognised religious institutions, including vetting sermons.

Those that operate without the Communist Party's blessing claim to have been targeted by authorities in recent years, pointing to the demolition of underground churches, persecution of members and pressure on their clergy to switch sides.

While some have hailed the Beijing-Vatican deal as a pragmatic compromise, others fear that China's underground churches will become even more marginalised.

"The situation has not improved at all," one underground priest in Jiangxi province told AFP recently.

The priest, who withheld his name over security concerns, said he had been banned by the government from carrying out church duties.

The renewal of the agreement, he said, would leave Catholics feeling "helpless and hopeless".

- Progress or setback? -

There was a potential sign of that pressure earlier this month when auxiliary bishop Vincenzo Guo Xijin of the Mindong Diocese in Fujian province abruptly resigned.

A person familiar with the matter told AFP Guo had resigned in protest after coming under pressure to join the state-run church, as the 2018 deal required bishops to do.

Other underground figures, including Bishop Augustine Cui Tai, remain detained or under house arrest.

The deal's supporters argue that it was never meant to address all outstanding issues, but was an important first step and largely beneficial to Chinese Catholics.

The Vatican will be braced for an angry response from Washington less than two weeks before a US election in which America's large Christian population is being wooed by President Donald Trump.

Earlier this month Secretary of State Mike Pompeo called on the Vatican to be "serious" in addressing religious persecution in China - unusually forceful language directed at the pope.

- Defeat for the underground -

Priests and dioceses in the Chinese state church did not respond to AFP interview requests.

However, one of them, Paul Han Qingping of northern Hebei province, wrote a blog post in late September supporting a renewal of the agreement.

"As the barriers... have been removed, bishops in China are now able to come together more often in collaboration and consultation in solving Church issues," he wrote, but admitted that some unofficial clergy remain resistant.

In a key concession to the agreement, Pope Francis recognised eight bishops appointed by China without papal approval.

At least two more former underground bishops were appointed with approval from both sides, and a handful of underground bishops joined the official church this year.

"The Vatican realises the importance of working within the system to prevent further restrictions on China's religious believers," said Lawrence Reardon, professor of political science at the University of New Hampshire.

Critics -- including retired Cardinal Joseph Zen of Hong Kong -- have accused the Vatican of betraying its values to appease China.

That has led the underground community "practically disappeared," he said.

"That's not victory, that's a defeat -- complete defeat."

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