Scientists confirmed last night that a parrot, imported from Surinam in South America, contracted and died from the disease while in a quarantine unit in southern England. The parrot, which died on 16 October, was part of a consignment of 148 birds imported from Surinam that had been housed in a quarantine unit along with 216 exotic birds from Taiwan, where the virus has been found.

Debby Reynolds, the chief vet at the Department for Environment, Food and Rural Affairs, confirmed tests were being conducted on tissue from the Taiwanese birds, some of which died before the parrot. All of the other birds that came into contact with the parrot have been culled.

Dr Reynolds said: "Our working hypothesis is that any infection in the birds from Surinam is likely to have arisen in the quarantine system, most likely in the facility in Essex where the Surinam birds shared airspace with the birds from Taiwan." She said that H5N1 had not been seen before, but most closely matched the disease found in ducks in China this year.

A second parrot that died in quarantine was also tested at the Veterinary Laboratories Agency in Weybridge, Surrey. Tissue from the two birds was pooled into one sample, so it is not known if only one or both was carrying the virus.

In a hastily arranged telephone press conference, Dr Reynolds said: " The UK, like other countries, needs to increase its vigilance to match this increased global risk. Ministers have also pressed the European Commission for an EU-wide ban on the importation of wild birds."

H5N1, which has killed 41 people in Vietnam, 13 people in Thailand, four in Cambodia and three in Indonesia since December 2003, is easily transmitted between birds. But there are fears the strain could trigger a flu pandemic if it mutates to spread more easily between humans. Sir Liam Donaldson, England's chief medical officer, has warned that 50,000 people in the UK could die from a flu pandemic.

Defra said the parrot's death did not affect Britain's status as being free of avian flu, because it occurred in quarantine. It was Britain's first confirmed case of avian flu since 1992. While Defra could not confirm the species of parrot, it is believd to be an orange-winged Amazon, the parrot most commonly imported from Surinam.

H5N1 has recently been found in birds in Russia, Turkey, Croatia and Romania. It had already spread widely in many Asian countries, including Taiwan but so far there are no reports of it in Surinam or any other South American country. It is possible that the Taiwanese birds may have carried the strain without showing any obvious symptoms. If so, then other infected birds from the region may have already passed through the quarantine system and into Britain.

The Surinam consignment ­ a mixture of parrots and "soft bills" ­ arrived in Britain on 16 September and the diagnosis of avian flu was made a month later on 16 October just before it was due to leave the month-long quarantine, Dr Reynolds added.

Ben Bradshaw, the junior Environment minister, said that before this latest outbreak of bird flu the Government had been considering a Europe-wide ban on the trade in live, exotic birds for the pet trade. "This is something we've been considering for some time, before the death of the parrot. It just so happens that the formal request has been made now," he said. "My understanding is there would be considerable support throughout the EU for this," he said.

European Union officials will meet tomorrow to discuss whether to go ahead and introduce such a ban on the trade in live, exotic birds.

Meanwhile, the Health Secretary, Patricia Hewitt, warned that a human flu pandemic in Britain at some point in the future is inevitable and could lead to people staying away from the workplace and public gatherings.

Ms Hewitt conceded that scientists had warned it was a case of when, not if, the flu strikes, but could not give a timetable because "we simply don't know".

Scientists believe the most likely cause of a flu pandemic will come from a genetic mutation of the H5N1 strain of bird flu currently moving across the world.

Ms Hewitt said it was incredibly important to be as prepared as possible. When asked if the country would "grind to a halt" if a pandemic occurred, she told ITV1's Jonathan Dimbleby programme: "I think you're pointing very clearly there to the scale of the problems that could arise depending on just how bad a pandemic turned out to be. If you've got a pandemic flu ... anyone who's got any flu-like symptoms would be well advised to stay home and not spread it and people I think would be well advised to stay away from large crowds where, of course, there is the risk of the flu being spread. But these are things which we will make decisions on and give very detailed guidance if or when pandemic flu actually broke out."

One option is to keep free-range domestic poultry indoors to limit the risk of infection from migrating wild birds, but Ms Hewitt said the Government did not yet think this was necessary. "Our veterinary experts have looked at the migration paths, for instance, they've looked at the risk and they've decided that that would not at this point be a proportionate response," she said.

Dr Bob McCracken, a past president of the British Veterinary Association, said the avian flu was "unique" because of the simultaneous manner in which it had spread in more than 15 countries. Thousands of birds have been slaughtered in the affected areas of south-east Asia, Russia, Turkey and Romania. Greece and Croatia have birds infected with the H5 virus but it is not yet known if they contain the H5N1 strain. Sweden said yesterday that four ducks in the Eskilstuna area, west of Stockholm, had tested positive for a "mild" form of the H5 virus but not the H5N1 strain.

Britain is stockpiling the anti-viral drug Tamiflu in case of a human flu pandemic . The Health Secretary warned of the dangers of buying the drug off the internet because the authenticity of the product could not be verified.

Ms Hewitt said the issue of producing a generic anti-viral and bypassing the producers of Tamiflu, Roche, was something that should be discussed. " It's an issue that has to be discussed internationally," she said, "because that sort of protection of copyright from the drug companies ... it does need to be discussed because we've got to look at the whole issue of the developing countries where frankly a pandemic flu is most likely to break out. And they need protection as well as us."

Today, a team of British scientists is travelling to Asia to inspect the spread of avian flu. The group, from the Medical Research Council (MRC), will travel to China, Vietnam and Hong Kong to look at the way the disease is being monitored. Sir John Skehel, director of the MRC National Institute for Medical Research, has warned that the number of cases reported in humans could be "the tip of the iceberg". The group also hopes to improve co-operation on how to deal with the spread of the virus during its 10-day stay.

Ms Hewitt said that the MRC was researching DNA vaccines to help combat a potential flu pandemic which could be developed much faster than a conventional vaccine. The latter might take between four and six months to develop.

* China said it will seal its borders, whatever the economic cost, if it finds a single case of human-to-human transmission of bird flu, the South China Morning Post newspaper quoted an official as saying.