Chinese President Xi Jinping arrived in the Seattle area on Tuesday to kick off a week-long U.S. visit that will include meetings with U.S. business leaders, a black-tie state dinner at the White House hosted by President Barack Obama and an address at the United Nations.
U.S. government and business leaders aim to strike a balance between forging agreements and improving relations with the world's second-largest economy, while sending strong messages about allegations of Chinese cyber spying and intellectual property violations as well as Internet censorship and China's disputed territorial claims to islands in the South China Sea.
Xi and his wife touched down in an Air China 747 at Paine Field, adjacent to the massive plant where Boeing makes its largest jets, some 25 miles north of Seattle. They were welcomed by Washington state Governor Jay Inslee.
The Chinese President is due to tour the Boeing's plant and nearby Microsoft Corp on Wednesday, and will later meet Warren Buffett, Apple Inc Chief Executive Tim Cook and Amazon.com head Jeff Bezos, among 30 or so U.S. and Chinese business leaders at a roundtable discussion.
U.S. tech companies are seeking to expand access to the Chinese consumer market. Even if no formal agreements are reached, the presidential blessing "sends an important message to Chinese leadership" to help them, said Ed Lazowska, Bill and Melinda Gates chair of computer science at the University of Washington.
For the Chinese side, Xi's meetings with Obama and U.S. business leaders offer the chance to bolster the president's stature at home, building on a high-profile military parade earlier this month to mark the end of World War Two, while deflecting attention from the country's recent stock market rout, slowing economy and a chemical explosion at a Tianjin warehouse that killed over 160 people.
No policy breakthroughs are likely during Xi's U.S. trip, which is due to begin with meetings with executives in Seattle and end with a speech at the United Nations General Assembly in New York on Sept. 28.
In comments published in the Wall Street Journal before his arrival, Xi said China's government does not engage in theft of commercial secrets or support companies that do. He also said China's economy faces downward pressure but is still operating within a proper range, adding exchange rate reform will continue and there was no basis for sustained depreciation in the yuan.
The United States will urge Xi to avoid "quick fixes" for its economy, such as devaluing its currency to boost exports, White House chief economist Jason Furman told Reuters on Tuesday.
China's recent loosening of controls on the yuan currency "caused turmoil" in global financial markets and U.S. officials plan to raise the issue of China's volatile stock market, Furman said.
For Boeing, the visit could bring a formal announcement of plans for an aircraft finishing plant in China. The plant would help Boeing's Chinese sales, analysts say, and help counter a threat from Commercial Aircraft Corp of China Ltd [CMAFC.UL], which is developing a single-aisle aircraft to challenge the top-selling Boeing 737 and Airbus A320 planes.
Xi and Ray Conner, Boeing Commercial Airplanes chief executive, are due on Wednesday to tour the Everett, Washington, factory where Boeing makes widebody planes such as the 777 and 787 Dreamliner. Airbus opened an assembly line in China in 2008 and recently won a landmark, $11 billion order from China.
Boeing CEO Dennis Muilenburg said on Tuesday he sees scope for additional 737 work going to China as the company continues to increase production rates of the single-aisle jetliner.
Xi is due to make a policy speech on Tuesday night in Seattle. But prospects for broad policy changes appear limited. The U.S. Chamber of Commerce expressed disappointment on Monday at the failure to narrow disagreement on a bilateral investment treaty that would open more Chinese business sectors to U.S. investment.
U.S. Trade Representative Michael Froman also said on Tuesday China needs to narrow its list of exceptions to a proposed bilateral investment treaty, a key part of the U.S.-China economic relationship.
The United States also wants to build on climate change commitments and agree on new rules to cut the risk of confrontation in the Asia-Pacific region, U.S. and Chinese sources have said.
China's slowing economic growth has raised questions about Xi's economic stewardship and puts him in a more difficult position than when he met with Obama last November in Beijing. "He comes into the summit on his back foot," a former senior administration official said.