U.S. Treasury Secretary Jack Lew met new Chinese President Xi Jinping on Tuesday at a critical time in relations between the world's two largest economies, with cyber hacking, market access and the Chinese currency high on the agenda for talks
In a carefully-choreographed gathering, both officials emphasized the importance of the relationship between the world's two largest economies, and made only passing reference to contentious topics.
"I can say we have a seamless connection," said Xi, speaking in front of a tapestry depicting a pine tree and flying cranes, both symbols of hospitality. "In the China-U.S. relationship we have enormous shared interests, but of course unavoidably we have some differences."
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Lew said both countries have a responsibility to promote global growth, and called on China to boost domestic demand to help in global rebalancing.
"The (U.S.) president is firmly committed to building a relationship of growing strength where we cooperate on issues of economic and strategic importance, understanding that we will each have to meet our own responsibilities, but we'll also have to manage our differences," he said.
The United States is eager for China to move toward a more consumer-oriented economy and away from investment and export-driven growth, which has contributed to a record-high $315 billion U.S. trade deficit with China last year.
Lew also called on both countries to reduce barriers to trade and investment, but did not mention concerns about China's undervalued yuan currency, a key concern for U.S. lawmakers.
U.S. companies face barriers to invest in around 100 Chinese sectors, while China has complained the United States blocks Chinese investments on unjust national security grounds.
The meeting was Xi's first with a senior foreign official since he was formally elected as president by China's parliament on Thursday in a once-in-a-decade transition. It is also Lew's first foreign trip since his confirmation, indicating the importance of the relationship.
Chinese Premier Li Keqiang, the head of government, pledged on Sunday to forge "a new type of relationship" with the United States and called for the end of a cyber-hacking row between the two countries.
A private U.S. computer security company said last month a secretive Chinese military unit was likely behind a series of hacking attacks targeting the United States. President Barack Obama raised the issue during a phone call with Xi last week.
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Lew plans to press Chinese officials to stop cyber attacks directed at the United States. China, in turn, says it is the target of U.S. hacking attacks.
Lew also wants Beijing to allow its currency to rise faster against the U.S. dollar, to take steps to increase market access for U.S. goods, and to better protect intellectual property rights.
Later on Tuesday, Lew is set to meet Xu Shaoshi, chairman of China's National and Development Reform Commission, the economic planning agency that wields approval authority over major investment projects.
Lew will also meet newly-appointed finance minister Lou Jiwei, formerly head of China's sovereign wealth fund, and U.S. business leaders.