HONG KONG - THE leader of Hong Kong's Catholic Church, Cardinal Joseph Zen, a staunch democracy campaigner and critic of China's rights record, said on Wednesday he would retire early next year.

Father Zen said his third request to step down had been approved by Pope Benedict XVI.

'I applied the first time when I was 75 and it was not approved. At 76, I applied for the second time and it was also turned down,' he told local broadcaster RTHK.

'But fortunately, this time, I am nearly 77 and the Pope said OK. In principle, it has been approved,' he said, adding he had planned to leave the post in the next few months.

The Shanghai-born cardinal, famous for his outspoken calls for democracy and religious freedom, said everything he had said or done was for the interests of the people.

He hoped his successor, Coadjutor Bishop John Tong, would improve relations between the Vatican and China.

'I have always hoped that through our voices, state leaders will understand that genuine religious freedom will definitely work towards the interest of the country,' he said.

Zen, head of the 250,000 Catholics in the territory since 2002, has not been afraid to criticise China, even while the Vatican has moved to improve diplomatic ties with Beijing.

The Holy See has long been at odds with China over who controls the booming Catholic church in the world's most populous nation.

The Vatican wants all Chinese Catholics - currently divided between an 'official' Church sanctioned by the Chinese government and an underground one loyal to the Vatican - to be brought under papal authority.

China severed its ties with the Vatican in 1951 in anger at the Holy See's diplomatic recognition of Taiwan, which remains a contentious issue.