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Xi Jinping holds out his hand to Washington as China-US talks begin

by June 6, 2016 General

President Xi Jinping on Monday called on China and the United States to prevent their ­differences from turning into ­confrontation.

With ties between the powers strained over a series of issues, Xi took a conciliatory tone in his opening statement to the annual China-US Strategic and Economic Dialogue in Beijing.

Xi said the nations should cultivate mutual trust and cooper­ation and take part in regular talks.

“The fundamental thing is the two sides should stick to the ­principles of no conflict or confrontation, mutual respect and win-win cooperation,” he said.

Officials from both nations are using the dialogue to press each other on economic issues.

Washington has added overcapacity in the Chinese steel industry to its concern list, which includes long-standing issues such as exchange rate controls and intellectual property violations. China has highlighted the difficulties arising from interest-rate rises in the US.

US Secretary of the Treasury Jack Lew warned at the opening of the dialogue that China’s excess steel and aluminium production had a distorting and damaging ­effect on global markets, while ­Finance Minister Lou Jiwei defended Beijing’s position in a briefing.

Your quick guide to the US-China Strategic and Economic Dialogue

Vice-Premier Wang Yang said China would next week submit a “negative list” of sectors that would remain off-limits to US investment in China. The two ­nations have gone through 24 rounds of talks on a bilateral investment treaty (BIT) since 2008, but a deal has not been reached.

The ministerial meeting ­involving more than 100 high-ranking officials comes as ties ­between the two countries become increasingly strained over strategic and economic issues.

Tensions in the South China Sea have continued to rise, with top military officials making tit-for-tat claims at a security summit in Singapore over the weekend. US Secretary of Defence Ashton Carter said China was erecting a “Great Wall of self-isolation”, while Sun Jianguo, deputy chief of the PLA’s Joint Staff Department, said any attempt to isolate China would fail.

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Washington has criticised China for increasing its military presence in the disputed waters, and pressed China to accept the ruling of the Permanent Court of Arbitration in The Hague over a case brought by the Philippines regarding the disputes. Beijing has blamed the militarisation of the region on frequent military ­activity by the US, and has vowed to ignore the court ruling.

Xi acknowledged inevitable “differences and sensitive issues” between the two major powers, citing contrasting histories, societies and cultures. “There is no ­reason to be scared of having ­differences, the key is not to adopt a confrontational attitude ­towards any differences,” he said.

China must cut excess steel production, US Treasury Secretary says at opening of top-level talks between two nations

“Some differences can be solved through endeavour and both sides should work harder to solve them,” he said. “Some differences cannot be solved at the moment and both sides should take each other’s actual situations into consideration and take a ­constructive approach.”

Xi said the Asia-Pacific region should be an “inclusive big ­platform for cooperation” instead of an “arena for countries to leverage” and called for China and the US to cultivate a “mutual circle of friends”.

“China and the US have extensive mutual interests in the Asia-Pacific region. [We] should hold regular dialogues, cooperate, cope with various challenges and work hard to cultivate a mutual, instead of exclusive, circle of friends between the two countries,” he said.

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US Secretary of State John ­Kerry said Washington took no position on the claims of various parties in the maritime disputes. “The only position we’ve taken is: let’s not resolve this by unilateral action; let’s resolve this through rule of law, through diplomacy, through negotiation. We urge all nations to find a diplomatic solution, rooted in international standards and rule of law,” he said.

At one of the talks held alongside the dialogue, Kerry said China and the US were working together on issues concerning ­Pakistan, Afghanistan and Syria.

North Korea is expected to be a focus of the dialogue, after a visit to Beijing last week by a Pyongyang envoy who said it would continue with its nuclear programme.

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The SED also involves talks on climate change, the internet, non-proliferation, military exchange and law enforcement.

Shi Yinhong, an international relations professor at Renmin University, said on major issues such as the South China Sea, BIT and North Korea, the differences between China and the US were too big to overcome. “Overall the situation is grim,” he said. “I wouldn’t think we should expect any major breakthrough.”

The SED was initiated by the Obama administration in 2009. Many expect it to be phased out after the US election this year.

Zhao Minghao, a researcher at the China Centre for Contemporary World Studies, said: “Beijing and Washington should set up a new mechanism for risk control as soon as possible in case of ­emergencies that could upset the entire world.”