The Taliban announced a 10-day ceasefire in Pakistan's Swat Valley on Sunday after freeing a Chinese hostage during peace talks with the government, while an abducted American threatened with imminent death by his kidnappers remained missing.

Past peace deals with militants, including in Swat, have failed. Any agreement this time could spark renewed U.S. criticism that peace talks merely give militants time to regroup and rearm.

Taliban spokesman Muslim Khan called the release of Chinese engineer Long Xiaowei a goodwill gesture as government officials and Taliban sympathizers said they had come to terms on introducing elements of an Islamic judicial system in Swat and surrounding areas.

"In view of these developments, we announce a unilateral ceasefire for 10 days, but we reserve the right to retaliate if we are fired upon," Khan told the Associated Press.

The Swat Valley was once a tourist haven and is now believed to be mostly under control of the militants, who have long demanded imposition of Islamic, or Shariah, law.

Regaining Swat is a major test for Pakistan's shaky civilian government because, unlike the semiautonomous tribal regions along the Afghan border where al-Qaeda and Taliban have long thrived, the valley is supposed to be fully under its control.

A string of recent attacks on foreigners — including the apparent beheading of a Polish geologist — have underscored the deteriorating security conditions.

UN official threatened with death

On Friday, the kidnappers of American UN official John Solecki threatened to kill him within 72 hours and issued a 20-second video of the blindfolded captive saying he was "sick and in trouble."

UN officials said Sunday they were still trying to establish contact with the gunmen who seized Solecki on Feb. 2 in Quetta, a southwestern city near the Afghan border.

The kidnappers have identified themselves as members of the previously unknown Baluchistan Liberation United Front, indicating a link to separatists rather than to Islamists.

The captors have demanded the release of 141 women allegedly detained in Pakistan, but Interior Ministry chief Rehman Malik has denied that the 141 are being held.

Baluchistan provincial government spokesman Syed Kamran said it was offering a $31,363 reward "for any information leading to the recovery of the kidnapped UN official."

Pakistani government officials could not immediately be reached for comment on the announced ceasefire. Officials would not comment on whether a ransom was paid or militants were freed in exchange for the Chinese engineer's release Saturday.

Long's freedom was secured days before a planned visit to China by Pakistani President Asif Ali Zardari.