- POSTED: 08 Jul 2014 21:12
- UPDATED: 08 Jul 2014 23:35
China and the United States are set to attempt to mend soured ties in Beijing, at high-level talks involving Vice Premier Wang Yang and US Secretary of State John Kerry.
SHANGHAI: China and the United States are set to attempt to mend soured ties at an annual meeting in Beijing.
The high-level talks, involving Vice Premier Wang Yang and US Secretary of State John Kerry, are aimed at ironing out concerns over marine disputes and cyber-security, as well as boosting mutual trust and cooperation.
The visit of US officials to Beijing for annual talks known as the Strategic and Economic Dialogue is especially significant to mediate differences between both sides.
There was the fall-out over a no-fly zone in the East China Sea - declared by China, but rejected by the US.
Tension grew further when the US indicted Chinese military officers for cyber espionage.
The strained relations came to a head when defence chiefs of the two countries traded heated words at a diplomatic meet.
Zha Xiaogang, director at Institute for World Economy Studies, Shanghai Institute of International Studies, said: "Even though last year at Sunnylands, Chinese President Xi Jinping and President Barack Obama reached consensus on new relations between the two countries, their strategies, levels of integration be it in politics, security and economics have seen rising antagonism.
“So these two very important countries, if they continue down this path of divergence, it will not just be detrimental to both sides, it will affect the economic and political stability of the world."
Economics-wise, the two-day dialogue will see China reiterate its case on the renminbi, which the US has long accused it of manipulating to make its exports more competitive.
The currency saw an orchestrated fall by China's central bank earlier this year to curb speculative bets on its rise, and has since stabilised.
Xi Junyang, deputy director of Modern Finance Research Centre at Shanghai University of Finance and Economics, said: "China has almost struck a balance with its exports. Export surplus has been low. The proportion of surplus to GDP comes up to over two points.
“According to international standards, this is within an acceptable range. So under this level, renminbi exchange rate matches the export situation. So there's no need for further drastic adjustments."
China is also expected to seek further clarifications from the US on its quantitative easing policy.
With much at stake, leaders from both countries are eager for talks to head in the positive direction during the two-day dialogue.
Agreements and fact sheets will be announced at the end of talks to illustrate progress made on several issues in the past year.