MALAYSIAN Prime Minister Datuk Seri Dr Mahathir Mohamad, the first foreigner to get a close-up view of Li Peng since April, said the Chinese premier appeared to have suffered a serious illness but had recovered. Dr Mahathir said yesterday that Mr Li seemed ''quite well, although he looks as if he's had a long spell of illness''. Mr Li, who disappeared from public view in late April after reportedly suffering a heart attack, held an 80-minute meeting with Dr Mahathir on Monday and hosted a state banquet for him on Tuesday evening. ''I noticed nothing to indicate he's in any great discomfort,'' Dr Mahathir said. ''I would say that if he has been ill, he has recovered.'' The Malaysian Prime Minister was given no specific details of Mr Li's illness or present physical state. ''I assume any slight appearance of being off-colour was because what the newspapers said [about Mr Li's illness] was true. I didn't do any personal examination,'' he said. Dr Mahathir said he was satisfied with Mr Li's commitment to resolve disputes through negotiations rather than military means, specifically over the question of the Spratly Islands in the South China Sea, a key point of regional tension. China, Malaysia and several other Asian countries claim the Spratlys. Privately, Asian officials have expressed concern about Chinese intentions in the area. On one hand, Beijing has pledged not to resort to force over the Spratlys. But early last year it published a law of the sea asserting its sovereignty over the islands. That was followed by China awarding a contract to an American company in an area of the South China Sea which Vietnam considers part of its coastal shelf. ''Both of us agreed that if there are any conflicting claims, we should be prepared to sit down and discuss [them],'' Dr Mahathir said. ''As far as I'm concerned, this is all that I expect. I don't expect complete solution at the moment, but the fact that China is willing to sit down and discuss the claims is, to us, very good indeed.''