The Biden-Xi meeting is aimed at getting the relationship on better footing, but tough issues loom

San Francisco: Presidents Joe Biden and Xi Jinping head into their big meeting at a country estate on Wednesday hoping to stabilize U.S.-China relations after a period of tumult, but the U.S. president also is prepared to confront his counterpart on difficult issues such as trade, Beijing's burgeoning relationship with Iran and human rights concerns.

The two leaders, who will meet on the sidelines of a summit of Asian-Pacific leaders, last spoke a year ago. Since then, already fraught ties between the two economic superpowers have been further strained by the U.S. downing of a Chinese spy balloon that had traversed the continental U.S. and over differences on the self-ruled island of Taiwan, China's hacking of a Biden official's emails and other incidents.

The two leaders are in California for the annual Asia-Pacific Economic Cooperation (APEC) forum, but will hold their one-on-one talks at Filoli Estate, a country house and museum about 25 miles (40 kilometres) south of San Francisco, according to three senior administration officials. The officials requested anonymity to discuss the location, which had not yet been confirmed by the White House or the Chinese government due to tight security.

Both men are seeking to show the world that while the U.S. and China are economic competitors, they are not locked in a winner-take-all face off with global implications. Their relationship has been increasingly defined by differences over export controls, Taiwan and the conflicts in the Middle East and Europe. Biden is expected to let Xi know that he would like China to use its sway over Iran to make clear that Tehran or its proxies should not take action that could lead to expansion of the Israel-Hamas war.

The Biden administration also sees the Chinese, a big buyer of Iranian oil, as having considerable leverage with Iran, which is a major backer of Hamas. Biden on Tuesday billed the meeting as a chance to get Washington and Beijing back “on a normal course corresponding” once again. But White House National Council spokesman John Kirby said Biden was “not going to be afraid to confront where confrontation is needed on issues where we don't see eye to eye.” "We're also not going to be afraid, nor should we be afraid, as a confident nation, to engage in diplomacy on ways which we can cooperate with China -- on climate change, for instance, and clean energy technology,” Kirby said.

Biden will be focused on managing the countries' increasingly fierce economic competition and keeping open lines of communication to prevent misunderstandings that could lead to direct conflict between the two powers. While he's expected to defend U.S. expansion of export controls on semiconductor chips, he also will assure Xi that the U.S. is not trying to wage economic war with Beijing amid continuing signs that China's economy is struggling to recover from the disruptions of the pandemic. Xi, meanwhile, is looking for assurances from Biden that the U.S. will not support Taiwan independence, start a new cold war or suppress China's economic growth. He's also keen to show the U.S. that China is still a good place to invest. Even before their meeting, there were some signs of a thaw:

The State Department on Tuesday announced that the U.S. and China -- two of the world's biggest polluters -- had agreed to pursue efforts to triple renewable energy capacity globally by 2030, through wind, solar and other renewables. There was also hope for some concrete agreements to come out of the meeting Wednesday, including on re-establishing military-to-military communications that have largely gone dark since August 2022, and on efforts to curb illicit fentanyl, a synthetic opioid that is increasingly responsible for U.S. drug overdoses. Many of the chemicals used to manufacture the drug come from China. The APEC summit events already have attracted considerable demonstrations and more were expected Wednesday, including protests against Xi and against multinational corporations focused on profits. In the hours before the meeting, White House officials said Biden was coming into the talks bolstered by signs the U.S. economy is in a stronger position than China's, and that the U.S. is building stronger stronger alliances throughout the Pacific. The U.S. president, speaking at a campaign fundraiser on Tuesday evening, pointed to his upcoming meeting as an example of how “reestablished American leadership in the world is taking hold.”

As for China, the president told donors, it has ”real problems." The International Monetary Fund recently cut growth forecasts for China, predicting economic growth of 5 per cent this year and 4.2 per cent in 2024, down slightly from previous forecasts. Last month, Beijing released economic data that showed prices falling due to slack demand from consumers and businesses. Biden, meanwhile, has taken pride in proving wrong a large swath of economists who predicted that millions of layoffs and a recession might be needed to bring down inflation. The Labour Department said Tuesday that consumer prices rose at an annual pace of 3.2 per cent annually, down from a June 2022 peak of 9.1 per cent. Meanwhile, employers keep hiring and the unemployment rate has held below 4 per cent for nearly two years. Xi, after his meeting with Biden on Wednesday, will address American business executives at a USD 2,000-per-plate dinner that will be a rare opportunity for U.S. business leaders to hear directly from the Chinese leader as they seek clarification on Beijing's expanding security rules that may choke foreign investment.

Foreign companies operating in China say tensions with Washington over technology, trade and other issues and uncertainty over Chinese policies are damaging the business environment and causing some to reassess their plans for investing in the giant market. A senior Biden administration official who briefed reporters ahead of the meeting said one big reason why Xi decided to make the trip to the U.S. was to send the message to American CEOs that China was still a good place to invest. The official spoke on the condition of anonymity under ground rules set by the White House. Senate Majority Leader Chuck Schumer said Tuesday that during a recent visit to Beijing, he and other lawmakers made the case directly to Xi that he could bolster China's reputation in the U.S. and around the globe by taking action to stop the flow of chemicals used to produce fentanyl. “It is reported he's very worried about the negative opinion of China in the United States,” Schumer said. “And I told him nothing could help raise China's image a little bit in the United States more than stopping the flow of fentanyl.