The Nobel Peace Prize for 2010 has been awarded to jailed Chinese writer Liu Xiaobo, the Oslo-based Nobel committee said today in a statement.

The awarding of the peace price to Mr Liu (54) is a major embarrassment for the Beijing government, which jailed the writer as a subversive dissident last year.

The Norwegian Nobel Committee praised Mr Liu for his “long and non-violent struggle for fundamental human rights in China. The . . . Committee has long believed that there is a close connection between human rights and peace.”

Mr Liu is one of China’s most famous dissidents, a writer, teacher and political essayist currently serving an 11-year jail term for subversion. Over two decades he has become one of China’s most famous naysayers for his advocacy for freedom of expression, human rights and democracy.

China condemned the award of the prize to Mr Liu as obscene, saying it would harm the country’s relations with Norway.

“The awarding of the peace prize by the committee to this person completely contradicts its aims and is an obscenity against the peace prize,” Chinese Foreign Ministry spokesman Ma Zhaoxu said in a statement on the ministry’s website.

US president Barack Obama called on China to release Mr Liu as soon as possible.

“Over the last 30 years, China has made dramatic progress in economic reform and improving the lives of its people, lifting hundreds of millions out of poverty,” Mr Obama, last year’s Nobel peace laureate, said in a statement. “But this award reminds us that political reform has not kept pace, and that the basic human rights of every man, woman and child must be respected.”

Beijing residents reported that the signal was temporarily cut on CNN and BBC broadcasts when the peace prize story was mentioned. In China, foreign news channels are restricted to upmarket hotels and apartment complexes.

Last year, Mr Liu was jailed on charges of “incitement to subvert state power and overthrow the socialist system” because of his key role in writing Charter 08, a political manifesto calling for gradual political reforms in China, modelled on the Czech Charter 77.

This was a groundbreaking pamphlet in which Czech and Slovak intellectuals pledged “to strive individually and collectively for respect for human and civil rights in our country and throughout the world”. More than 300 people, including some of China’s leading intellectuals, signed the Charter 08 document, and it earned Mr Liu the longest sentence ever given out for dissent.

Mr Liu previously spent nearly two years in jail for joining the 1989 student-led protests in Tiananmen Square. He also prevented more bloodshed by successfully negotiating with the army the evacuation of the last remaining students on the square in the early morning of June 4th.

Chinese deputy foreign minister Fu Ying had warned the head of the Nobel Institute against granting the prize to Mr Liu during a visit to Oslo this summer, saying it would damage ties between China and Norway as they negotiate a bilateral trade deal. Beijing also strongly criticised Oslo after the 1989 prize went to Tibet’s exiled spiritual leader, the Dalai Lama.

A Chinese Foreign Ministry spokeswoman said last month that Mr Liu’s actions were “diametrically opposed to the aims of the Nobel prize”.

China summoned Oslo’s ambassador to Beijing to make a formal protest. In Oslo, China’s ambassador to Norway met a state secretary at Norway’s Foreign Ministry, spokeswoman Ragnhild Imerslund said. China requested both meetings to express its discontent with the peace prize decision, she added.

She said the Norwegian officials explained that the peace prize committee was independent of the government and that Norway wanted to maintain good relations with China.

The prize worth 10 million Swedish crowns will be awarded in Oslo on December 10th. It was not immediately known who would collect the prize if Mr Liu could not do so.

Mr Liu’s wife, Liu Xia, said in an interview earlier this week that although his spirits were good, his health was not great. She last saw him on September 7th. “Liu Xiaobo’s friends often tell me they wanted him to get the prize more than he did, because they think this is an opportunity to change China,” she said.

Mr Liu had been put forward for the prize by Vaclav Havel, the dissident playwright and key Charter 77 figure who became president of Czechoslovakia after the fall of communism, and by the US chapter of rights group International Pen.

Responding to the news, Amnesty International said the award put the spotlight on China rights violations

The organisation today called on the Chinese authorities to release all prisoners of conscience detained in the country after Mr Liu was awarded the prize.

“Liu Xiaobo is a worthy winner of the Nobel Peace Prize, we hope it will keep the spotlight on the struggle for fundamental freedoms and concrete protection of human rights that Liu Xiaobo and many other activists in China are dedicated to,” said Colm O’Gorman, executive director of Amnesty International Ireland.

“This award can only make a real difference if it prompts more international pressure on China to release Liu, along with the numerous other prisoners of conscience languishing in Chinese jails for exercising their right to freedom of expression.”

(Additional reporting by Reuters)