Overview of China-U.S. Relations

Following the founding of the People’s Republic of China, China and the United States had a long period of estrangement. In February 1972, U.S. President Richard Nixon visited China at the invitation of Premier Zhou Enlai, starting the process of normalization of China-U.S. relations. In May 1973, China and the United States opened liaison offices in each other’s capital. On January 1, 1979, the two counties officially established diplomatic relations at the ambassadorial level. The United States announced that it would sever its “diplomatic relations” with Taiwan, withdraw U.S. military forces from Taiwan, and terminate the Mutual Defense Treaty.

Based on the Five Principles of Peaceful Coexistence, China and the U.S. issued the Joint Communiqué of the People's Republic of China and the United States of America (Shanghai Communiqué) on February 29, 1972, the Joint Communiqué on the Establishment of Diplomatic Relations between the People's Republic of China and the United States of America on December 16, 1978, and the August 17 Joint Communiqué of 1982. The three joint communiqués are the foundation for China and the U.S. to develop stable, sound and normal bilateral relations.

Since the establishment of diplomatic ties, China-U.S. relationship has been moving forward steadily despite some twists and turns. The two sides have conducted extensive exchanges and cooperation in political, economic, military, cultural, people-to-people and sub-national areas as well as on international affairs. China-U.S. relationship is assuming greater global implications and strategic dimensions. It has become one of the most important bilateral relationships in the world.

1. Political Relations

Since China and the U.S. resumed contact, the two sides have seen frequent high-level visits and improving dialogue mechanisms. In January 1979, Vice Premier Deng Xiaoping visited the U.S., opening a new page in China-U.S. relations. In 1985, President Li Xiannian visited the U.S., the first state visit to the U.S. by China’s head of state since the founding of the PRC. President Jiang Zemin visited the U.S. in 1997 and 2002 respectively. During his visit in 1997, the two sides issued the China-U.S. Joint Statement. Presidents Richard Nixon (1972), Gerald Ford (1975), Ronald Reagan (1984), George H.W. Bush (1989), Bill Clinton (1998) and George W. Bush (2001, 2002, 2005, and 2008) paid a total of nine visits to China when in office.

In recent years, high-level exchanges of visits have been frequent between the two countries. President Hu Jintao visited the U.S. in 2006. In November 2009, President Barrack Obama paid a state visit to China. The two sides issued a Joint Statement during the visit. President Hu made a state visit to the U.S. in January 2011, and the two sides issued another Joint Statement during the visit. And they also jointly made the strategic decision to work together to build a China-U.S. cooperative partnership based on mutual respect and mutual benefit, which charted the direction of China-U.S. relations. In the past three-plus years, the two presidents have had 12 face-to-face meetings during bilateral visits and on multilateral occasions. Vice President Joe Biden visited China in 2011, and Vice President Xi Jinping paid a return visit in 2012.

Since the 1980’s, China and the U.S. have established more than 60 dialogue mechanisms, including the Strategic and Economic Dialogues (S&ED), the Joint Commission on Commerce and Trade (JCCT), the High-Level Consultation on People-to-People Exchanges (CPE), and the Joint Commission on Science and Technology Cooperation. These mechanisms cover political, economic, military, educational, scientific and technological, cultural, counterterrorism, nonproliferation, and regional and international affairs, as well as exchanges between the two legislatures.

Given the differences in their political systems, historical and cultural traditions and levels of economic development, it is natural that China and the U.S. have different views on certain issues. China stands ready to work with the U.S. to steer bilateral relationship toward a cooperative partnership, deepen mutual trust and cooperation, properly handle Taiwan, Tibet, human rights and other sensitive issues, and ensure that China-U.S. relations will continue to grow in a stable and sound way.

2. Economic and Trade Relations

China-U.S. economic and trade relations is mutually beneficial in nature. It is a critical pillar for China-U.S. relations. As the biggest developing country and the biggest developed country, China and the U.S. enjoy great complementarity in terms of natural and human resources, market, capital and technology. Since the establishment of diplomatic ties, bilateral economic and trade relations have been growing rapidly, with broadening areas of cooperation, increasing substance and greater interdependence. Compared with the early days of diplomatic relations, China-U.S. business ties have moved from a predominantly trade relationship to one that covers almost all aspects of economic life.

In the area of trade, according to statistics from the Chinese Customs, bilateral trade in 2011 reached US$446.7 billion, an increase of over 180 times from the beginning of diplomatic relations. China and the U.S. are the second largest trading partner for each other. The U.S. is China’s second largest export market and sixth largest source of import. China is the third largest export market and the largest source of import for the U.S. It has been the fastest growing export market of the U.S. for 10 consecutive years. Based on U.S. statistics, U.S. exports to China grew by 468% between 2000 and 2010 while its exports to its other trading partners only grew by 55% during the same period.

In the area of investment, the U.S. is one of the largest sources of foreign investment. In 2011 alone, China approved 1,426 new U.S. businesses in China. By the end of 2011, the U.S. had invested in 61,000 projects in China with a total paid-in value of US$67.59 billion. Since 2005, Chinese investment in the U.S. has been growing at a rapid pace. Currently, non-financial Chinese direct investment in the U.S. has exceeded US$6 billion, covering industry, science & technology, clothing, food processing and other areas. Chinese companies have opened 1,600 businesses in the U.S., hiring 15,500 local employees.

China and the U.S. have put in place a number of dialogue mechanisms to oversee their economic and trade relations, including the Sino-U.S. Joint Economic Committee in 1979, the JCCT since 1983, the Strategic Economic Dialogue (SED) launched in 2006, and the S&ED as of 2009. Since 2009, Chinese Vice Premier Wang Qishan and U.S. Treasury Secretary Timothy Geithner have co-chaired four rounds of Economic Dialogues under the framework of S&ED, which have produced concrete results on 218 items covering wide ranging areas such as macroeconomic policy, finance, trade, investment, international rules and global economic governance. These dialogue mechanisms have played a significant role in building a sound and stable economic and trade relationship.

China is ready to work with the U.S. to properly handle the issues and disputes in their economic and trade relations, expand collaboration in trade, investment, new energy and infrastructure, and promote bilateral business ties to greater depth, breadth and scope. It is hoped that the U.S. would accommodate China’s concerns when reforming the U.S. export control regime, promote the export of civilian high-tech products to China, and take concrete steps to provide a fair and hospitable environment for Chinese investment in the U.S.

3. Military-to-military Relations

Military-to-military relations is an important component of China-U.S. relations. Since 1979, China and the U.S. have had exchanges and cooperation in the military field. The two militaries have established a number of dialogue and consultation mechanisms, such as the Military Maritime Consultative Agreement, the Defense Consultative Talks, and the Defense Policy Coordination Talks.

In recent years, the two militaries continue to have high-level exchanges and institutionalized dialogues, and have worked together in military archives, humanitarian disaster relief and other areas. In May 2012, General Liang Guanglie, Chinese State Councilor and Minister of Defense, visited the U.S. and exchanged views with the U.S. side on mil-to-mil relations as well as regional and international hotspot issues. The visit was a positive step in the development of China-U.S. military ties.

The mil-to-mil relations still faces some difficulties and obstacles, the major ones being U.S. arms sale to Taiwan, U.S. reconnaissance activities and relevant U.S. legislations that have negative implications on bilateral military exchanges. China is willing to work with the U.S. to move forward mil-to-mil ties on the basis of mutual respect, mutual trust, equality and reciprocity.

4. People-to-people Exchanges and Sub-national Cooperation

Since 1979, bilateral exchanges in culture, science and technology and education have become increasingly robust. The two sides have signed the Agreement on Cultural Cooperation, Agreement on Educational Cooperation and China-U.S. Agreement on Cooperation in Science and Technology, and set up a number of dialogue forums including the Joint Commission on Science and Technology Cooperation, and China-U.S. Cultural Forum. Chinese State Councilor Liu Yandong and U.S. Secretary of State Hillary Rodham Clinton co-chaired three rounds of the CPE. This mechanism has provided strong guidance and impetus for bilateral cultural and people-to-people exchanges. The two sides also launched a series of initiatives in the fields of education, science and technology, culture, sports, women and youth. China has pledged to provide scholarships for 10,000 U.S. students to study in Chinese universities, sponsor 10,000 scholarships under the “Chinese Bridge” program, and send 10,000 Chinese to pursue doctorate degrees in the U.S. The U.S. has launched the “100,000 Strong” initiative, i.e., sending 100,000 U.S. students to study in China within four years. Today, over three million visits are made between China and the U.S. each year, with more than 9,000 Chinese and Americans traveling across the Pacific each day. There are over 157,000 Chinese students in the U.S., and about 20,000 American students in China.

Sub-national exchanges and cooperation have served as an important foundation and driving force in the development of China-U.S. relations since the establishment of diplomatic relations. To date, the two countries have established 39 pairs of sister province/state relationships and 180 pairs of sister city relationships. Since 2000, business ties at the sub-national level has been expanding with a strong momentum. Forty-eight U.S. states have enjoyed a three-digit growth rate in their exports to China, which is far higher than that with other countries and regions. Exchanges and mutually beneficial collaboration in education, culture, tourism and other areas are also growing rapidly. In July 2011, the China-U.S. Governors Forum was established, which aims to provide a platform for engagement between local leaders and expand cooperation in trade, investment, energy, the environment, culture and people-to-people exchanges. Two rounds of dialogues have been held in Salt Lake City, Utah and Beijing respectively. To facilitate economic cooperation between Chinese and U.S. cities, the China Association of Mayors and the U.S. Conference of Mayors have held two conferences in Seattle, Washington in April 2011 and Nanjing, China in June 2012.

5. China-U.S. Cooperation in International Arena

China and the U.S. maintain close and effective communication and coordination on major regional and international as well as global issues. Areas of cooperation include regional hotspots such as the situation on the Korean Peninsula, Iranian nuclear issue and South Asia, non-traditional security issues such as counterterrorism, nonproliferation, energy security, public health, disaster prevention and reduction, and global challenges such as global financial crisis and climate change. The two sides have also put in place a series of region-specific consultation mechanisms that cover Africa, Latin America, South Asia and Central Asia, and have agreed to launch the mechanism on Middle East. Through close coordination, China and the U.S. are contributing to regional and global peace, stability and prosperity.

In recent years, China and the U.S. have conducted constructive dialogues and productive cooperation on Asia-Pacific affairs. The two sides initiated the China-U.S. Asia-Pacific Consultation in 2011, and have held three rounds of dialogues. This mechanism has played an important role in enabling China and the U.S. to work together to promote stability and prosperity in the Asia-Pacific region, facilitate open and inclusive regional cooperation and build a pattern of positive interactions and mutually beneficial cooperation between the two countries in the Asia-Pacific region.