Discussions a bridge to upcoming economic summit of senior leaders

Chinese and US officials began talks on Monday as a prelude to the fifth round of the Strategic and Economic Dialogue, touching on sensitive issues such as cybersecurity.

US officials said progress was made at the first meeting of the new China-US working group on cybersecurity.

"We had a constructive discussion with our Chinese counterparts, including norms of behavior in cyberspace," said Chris Painter, a US State Department coordinator for cyberissues, in a conference call on Monday.

"Both sides made practical proposals to increase our cooperation and build understanding and transparency between the two sides."

Painter said he hopes the first meeting will be the start of a substantive cybersecurity discussion between the US and China.

Chinese people were astonished by recent revelations from former US National Security Agency contractor Edward Snowden that the NSA hacked into Tsinghua University's computers and networks, as well as telecommunications companies in both the Chinese mainland and Hong Kong in an attempt to gather text messages from millions of users.

The Chinese Foreign Ministry has said often that China is the victim of cyberattacks and that it is willing to enhance dialogue and cooperation with the international community in the spirit of mutual trust.

Cyberissues are expected to be discussed at the two-day Strategic and Economic Dialogue, and both sides are looking for a positive tone from the talks, which start on Wednesday.

Tao Wenzhao, a US studies expert at the Chinese Academy of Social Sciences, said special attention should be paid to this round of the S&ED since it is the first dialogue between the two countries since President Xi Jinping and US President Barack Obama met in June at the Sunnylands estate in Rancho Mirage, California.

"The dialogue will make concrete plans for the implementation of the two leaders' agreements reached during their meeting," Tao said.

'Important opportunity'

Tao said that topics high on the agenda will include the two countries' interaction in the Asia-Pacific region, issues related to Taiwan and the Tibet autonomous region, denuclearization of the Korean Peninsula, cybersecurity, and economic cooperation.

"The dialogue will be an important opportunity for the two countries to increase consensus and explore new areas of cooperation," Tao said.

US Assistant Secretary of State for East Asian and Pacific Affairs Kin Moy emphasized that this S&ED will have four new faces who will co-chair the dialogue, with US Secretary of State John Kerry and US Treasury Secretary Jack Lew, and China's Vice-Premier Wang Yang and State Councilor Yang Jiechi.

The schedule for Kerry, whose wife was hospitalized earlier this week, will be determined day by day this week, State Department spokesman Patrick Ventrell said.

A highlight of the S&ED will be talks on energy security and climate change, which Moy described as a new feature of the dialogue.

"We want to demonstrate to the world that the two largest economies in the world can cooperate in this century to help tackle this environmental challenge," Moy said.

Sharon Yuan, deputy assistant secretary of treasury for trade and investment policy, described the S&ED as an important opportunity to bring together senior officials from the two governments to discuss, engage and make progress on issues of concerns to both countries.

Washington has expressed concerns over the role of China's State-owned enterprises, IPR protection, exchange rates and interest rates, and Chinese economic reform, which is expected to turn the economy from an investment-driven mode to one that is consumption-driven.

China has raised issues over the US government review process regarding Chinese direct investment in the US, the restrictions of high-tech exports to China as well as the quantitative easing policy, which China claims is hurting its economy.

As usual, heavyweights from both sides will attend the S&ED. The guest list will include Finance Minister Lou Jiwei, central bank Governor Zhou Xiaochuan and Commerce Minister Gao Hucheng, US Federal Reserve Chairman Ben Bernanke, US Commerce Secretary Penny Pritzker and US Trade Representative Michael Froman.

Cheng Guangjin in Beijing contributed to this story.