By Michael Martina and Greg Torode

SAN FRANCISCO/HONG KONG (Reuters) – When Chinese President Xi Jinping met with officials for dinner in San Francisco on Wednesday night, he was greeted with not one, but three standing ovations from the U.S. business community.

It was one of several public relations victories for the Chinese leader on his first visit to the United States in six years, where he and President Joe Biden signed agreements covering fentanyl, military communications and artificial intelligence on the sidelines of Asia-Pacific economic cooperation. But arrived. meeting.

Two people briefed on the visit said all three were outcomes the United States sought from China, not the other way around.

But Xi appears to have achieved his goals: earning US policy concessions in exchange for promises of cooperation, reducing bilateral tensions that would allow a greater focus on economic development, and attracting those foreign investors. Those who are rapidly moving away from China will get the opportunity.

China’s economy is slowing and earlier this month it posted its first quarterly loss in foreign direct investment. And the ruling Communist Party is battling political intrigue that has raised questions about Xi’s decision-making, including the sudden and unexplained removal of his foreign minister and defense minister.

“If the US and China can manage their differences … it will mean Xi Jinping doesn’t have to put all his attention on that (bilateral relations),” said Alexander Neal, an adjunct fellow at Pacific Forum Think-tank in Hawaii. It will take.” Tank.

“He needs to focus on his domestic agenda which is incredibly pressing.”

lifting restrictions for cooperation

Securing Xi’s promise of Chinese cooperation to stem the flow of fentanyl into the United States was at the top of Biden’s to-do list for the summit. A senior US official said the agreement under which China would go after specific companies producing fentanyl precursors was built on the basis of “trust but verification”.

In turn, the US government on Thursday removed a Chinese public security forensic institute from the Commerce Department’s trade sanctions list, where it was placed over alleged abuses against Uighurs in 2020, a long-sought diplomatic objective for China. Was.

Critics have warned the lifting of sanctions against the institute signals Beijing could compromise the U.S. entity listing, and have questioned the Biden administration’s commitment to press China to address the Chinese government’s genocide of the Uyghurs. Is telling.

A spokesman for the Republican-led House of Representatives Select Committee on China said, “This undermines the credibility of our entity list and our moral authority.”

On top of this, Biden’s Republican opponents argue that the US is missing an opportunity by not taking advantage of China’s economic momentum for greater diplomatic leverage.

Biden also described as a success the agreement to restart military dialogue cut off by China following a visit by then US House Speaker Nancy Pelosi to Chinese-claimed Taiwan in 2022.

But while Beijing would welcome reduced tensions, it is unlikely to change Chinese military behavior that the US considers dangerous, such as intercepting US ships and aircraft in international waters, which has at times led to near misses.

“China fears that the hotline could be used as a potential pretext for increased US presence in areas it claims as its own,” said Craig Singleton, a China expert at the Foundation for Defense of Democracies in Washington.

Biden administration officials have acknowledged that building a functional military relationship will not be as easy as semi-regular meetings between defense officials.

“It’s going to be a long, hard, slow effort and the Chinese are going to have to see the value in that run-of-the-mill thing before they do it. It would be doing us no favors,” a Biden administration senior told Reuters in October. Before the Xi-Biden meeting.

Companion and friend?

In his public remarks to Biden, Xi suggested that China wants peaceful coexistence with the United States, and he told business leaders that China is ready to be America’s “partner and friend.” This was partly due to the business community being concerned about China’s actions. Use of exit bans and detentions against various industries and certain officials.

Similarly, Xi’s televised garden walk with Biden, and the largely respectful welcome given to Xi by his American hosts, were highlighted in China’s tightly controlled media to show domestic audiences that their president is the country’s most important person. Managing economic and political relations.

Drew Thompson, a former Pentagon official who is now a scholar at the National University of Singapore, said, “Xi Jinping may have calculated that exaggerating the American threat would benefit his position in China and the party itself.” There will be more damage than that.” ,

“The fact that we are debating whether China is investable is a real problem for China.”

At the same time, Xi echoed Biden’s points he made to Russian President Vladimir Putin earlier this year, asking the US president to strengthen US-China relations through “accelerating global transformations not seen in a century.” Was requested to see.

Analysts say it is code for the belief that China – and Russia – are reshaping the US-led international system.

Still, this time pragmatism may outweigh ideology.

Li Mingxiang, a professor at the Rajaratnam School of International Studies in Singapore, said China believes maintaining some degree of normalized relations with the United States and Western countries is still important for its economic progress.

“This is the fundamental driving force behind the meeting.”