Notwithstanding their competing interests, China and the US today vowed to improve their ties and not allow persistent differences over Beijing's maritime claims, cyberhacking and currency rates to impact a globally crucial relationship.
Warning of serious consequences if the conflict continued, Chinese President Xi Jinping told an annual meeting of top diplomats and officials of the two countries here today that "China-US confrontation, to the two countries and the world, would definitely be a disaster".
"We should mutually respect and treat each other equally, and respect the other's sovereignty and territorial integrity and respect each other's choice on the path of development."
Playing the down the increasingly difficult relationship, he said "it is natural that China and the US may have different views and even frictions on certain issues" given their different histories and cultures.
"This is what makes communication and cooperation even more necessary," he said speaking at the historic guest house where then US President Richard Nixon met Mao Zedong on his groundbreaking visit to China in 1972.
Nixon's visit laid the foundation for hardline Communist China to come out of an ideological morass and its emergence as the world's second largest economy riding on the crest of large inflows of FDI and technology.
The sixth US-China Strategic and Economic Dialogue (SED) is being attended by Secretary of State John Kerry and Treasury Secretary Jacob Lew besides Federal Reserve chief Janet Yellen and three other senior administration members.
The SED is taking place after a series of tensions between the two countries sparked by China's increasing conflicts with US allies Japan, Vietnam and the Philippines over Beijing's push to assert its claims over the East and South China Seas.
The two sides also had a tense stand off over NSA contractor Edward Snowdon pointing to US cyber espionage of several Chinese companies and counter allegations by Washington accusing China's military of carrying out cyber surveillance on a number of US companies.
Xi said the two sides should moderate their tensions as "our interests are more than ever interconnected," and both "stand to gain from cooperation and lose from confrontation".
"If we are in confrontation it will surely spell disaster for both countries and for the world," he said calling on both the countries, "to break the old pattern of inevitable confrontation".
