With Xi Jinping’s assumption to the presidency at the National People’s Congress, China’s leadership transition finally ended and high-level US-China contacts and exchanges picked up steam.  Senior US officials traveled to China in succession to discuss urgent matters such as North Korea’s third nuclear test as well as less pressing questions such as how to define the “new type of major power relationship” between the US and China. Secretary of the Treasury Lew, Secretary of State Kerry, Chairman of the Joint Chiefs of Staff Dempsey, and Deputy Secretary of State Burns visited Beijing.  North Korea’s third nuclear test provided an opportunity for the US and China to cooperate more closely.  Cybersecurity rose to the top of the bilateral agenda as growing evidence revealed the extent of Chinese state-sponsored hacking into US government agencies and companies.

The rare convergence of a US presidential election cycle and China’s once-in-a-decade leadership transition caused both countries to focus their energies and attention domestically in the last four months of 2012. The US held its presidential election on Nov. 6 and China held its 18^th Party Congress Nov. 8-14.  The reelection of President Obama was a relief for Beijing.  Although China has plenty of complaints about his policies, it preferred to deal with him for another four year term, both because of the uncertainty that the election of Mitt Romney would have brought to US foreign policy and because the Chinese generally favor the status quo when it comes to US leadership.   Washington was simply glad to get the Chinese leadership transition underway since it appeared that Chinese leaders and the bureaucracy were distracted and many decisions had been put on hold pending announcement of the new leadership lineup.

In the second trimester of 2012, the US began to flesh out its rebalancing to Asia strategy, prompting Chinese concerns. The fourth round of the Strategic and Economic Dialogue (S&ED) was held in Beijing in May amid a kerfuffle over Chinese dissident lawyer Chen Guangcheng.  Presidents Barack Obama and Hu Jintao held their 12^th and likely final bilateral meeting in June on the margins of the G20 Summit in Los Cabos, Mexico.  Bilateral friction intensified over developments in the South China Sea.  US-China military interactions stepped up with a visit to the US by Chinese Defense Minister Liang Guanglie and a visit to China by Commander of the US Pacific Command Samuel Locklear.  The US-China Human Rights Dialogue was held in Washington in July.

Xi Jinping’s visit to the US went smoothly and laid the foundation for a strong bilateral relationship after the 18^th Party Congress this fall. Speeches to mark the 40^th anniversary of Nixon’s visit to China highlighted progress while recognizing deep mutual strategic mistrust. The third Asia-Pacific Consultation was held to manage suspicions and enhance cooperation. President Obama met Hu Jintao on the sidelines of the Seoul Nuclear Security Summit.  Friction increased with the filing of a complaint with the WTO that charged China with manipulating prices of rare earth elements. Beijing angered Washington by vetoing a UNSC resolution that called for Syria’s president to step down. But, the Council later passed a resolution that authorized observers to monitor the ceasefire. China rebuffed US entreaties to reduce oil imports from Iran and the US imposed sanctions on a Chinese company for selling refined oil to Iran.

A spate of measures taken by the Obama administration to bolster US presence and influence in the Asia-Pacific was met with a variety of responses from China.  Official reaction was largely muted and restrained; media responses were often strident and accused the US of seeking to contain and encircle China.  President Obama met President Hu Jintao on the margins of the APEC meeting in Honolulu and Premier Wen Jiabao on the sidelines of the East Asia Summit.  Tension in bilateral economic relations increased as the US stepped up criticism of China’s currency and trade practices, and tit-for-tat trade measures took place with greater frequency.  Amid growing bilateral friction and discontent, the 22^nd Joint Commission on Commerce and Trade (JCCT) convened in Chengdu, China.  An announcement by the US of a major arms sale to Taiwan in September prompted China to postpone a series of planned exchanges, but the Defense Consultative Talks nevertheless proceeded as planned in December.

In pursuit of agreements reached between Presidents Hu and Obama in January, the US and China worked to strengthen their relationship, while managing friction on a number of issues. Renewed tensions in the South China Sea put maritime security at the top of the agenda in many bilateral and multilateral interactions, including the inaugural US-China Consultations on Asia-Pacific Affairs, at the ASEAN Regional Forum meeting in Bali, and in a bilateral meeting between Secretary Clinton and State Councilor Dai Bingguo in Shenzhen.  In early May, the third annual Strategic and Economic Dialogue (S&ED) convened in Washington, DC.  Despite protests from Beijing, President Obama met the Dalai Lama.  In May and July, PLA Chief of the General Staff Gen. Chen Bingde and Chairman of the Joint Chiefs of Staff Adm. Mike Mullen exchanged visits.  In August, Joe Biden made his first visit to China as vice president.

High-level contacts between the US and Chinese militaries resumed in January with a visit by Defense Secretary Robert Gates to China.  Immediately following his trip, President Hu Jintao traveled to the US for a state visit.  The occasion combined informal discussion with all the protocol trappings of a state visit by a leader from an important country.  Both countries exerted great efforts to ensure the visit’s success, which put the bilateral relationship on more solid footing after a year that was characterized by increased tensions and discord.  At the invitation of Secretary of State Hillary Clinton, State Councilor Liu Yandong made a week-long visit to the US in mid-April, during which she co-chaired with Clinton the second round of the Consultation on People-to-People Exchange.  China held its annual “two meetings” – the National People’s Congress and the Chinese People’s Political Consultative Congress – and endorsed the 12^th Five-Year Plan for National Economic and Social Development.

In the final quarter of 2010, China-US relations were marked by the now familiar pattern of friction and cooperation.  Tensions spiked over North Korea, but common ground was eventually reached and a crisis was averted.  President Obama’s 10-day Asia tour, Secretary of State Clinton’s two-week Asia trip, and US-ROK military exercises in the Yellow Sea further intensified Chinese concerns that the administration’s “return to Asia” strategy is aimed at least at counterbalancing China, if not containing China’s rise. In preparation for President Hu Jintao’s state visit to the US in January 2011, Secretary Clinton stopped on Hainan Island for consultations with Chinese State Councilor Dai Bingguo and Deputy Secretary of State Steinberg visited Beijing.  Progress toward resumption of the military-to-military relationship was made with the convening of a plenary session under the US-China Military Maritime Consultative Agreement (MMCA) and the 11^th meeting of the Defense Consultative Talks.  Differences over human rights were accentuated by the awarding of the 2010 Nobel Peace Prize to Chinese dissident Liu Xiaobo.

Diplomatic confrontations over the Yellow Sea and the South China Sea were the source of new bilateral tensions this quarter.  Beijing vigorously objected to the dispatch of the aircraft carrier USS George Washington to waters near where the South Korean corvette Cheonan sunk after being attacked in March, even before Washington had made a decision to deploy it.  Worried about Chinese diplomatic posturing and destabilizing activities in the South China Sea, Secretary of State Clinton delivered a clear statement of US interests at the ASEAN Regional Forum meeting in Hanoi that irritated Beijing.  With the US mid-term elections approaching, US frustration mounted over China’s unwillingness to allow its currency to appreciate against the dollar at a faster pace. The House of Representatives passed legislation that would allow the US to impose import duties on countries that have undervalued currencies. After more than five months of delay, the Pentagon submitted to Congress its annual report assessing Chinese military capabilities.  Finally, two US presidential envoys traveled to Beijing to smooth over relations and President Obama met Premier Wen Jiabao on the margins on the UN General Assembly.