In his first significant foreign policy statement since re-election, President Bill Clinton said he wanted "to sustain an engagement with China".
Washington views relations with Peking as its most important bilateral challenge as the two countries approach the next century. Speaking to the Australian parliament, Mr Clinton said: "The direction China takes in the years to come, the way they define its greatness in the future, will help to decide whether the next century is one of conflict or co- operation."
He stressed that his country had no interest in containing China. "That is a negative strategy," he said, while confirming that the US would maintain 100,000 troops across the Pacific.
This Sunday, at a regional economic forum in Manila, Mr Clinton will meet for the fourth time with his Chinese counterpart, Jiang Zemin. They may discuss a possible exchange of state visits next year which would symbolise a new phase in Sino-US relations.
In Peking, the US Secretary of State, Warren Christopher, yesterday emphasised the strategic importance of the relationship and the scope for building on the "positive momentum" of recent improvements in ties. However, his talks with Mr Jiang, the Prime Minister, Li Peng, and the Foreign Minister, Qian Qichen, failed to yield any public sign of softening on the Chinese side.
While Mr Christopher concentrated on the potential rewards to Peking of a more stable relationship, China was still playing hardball on key issues of disagreement. Mr Qian attacked the US's "massive" arms sales to the island state of Taiwan, "the core issue of Sino-American relations". US officials later said sales of defensive armaments to Taiwan would continue.
Comments on the vexed questions of China's human rights record illustrated the gulf between Washington and Peking's presentation of the day's diplomacy. Mr Christopher yesterday said he had raised human rights and the recent harsh sentences on dissidents in his meetings.
"It was, I think, probably the most coming-to-grips discussion that we've had of human rights issues for some time, maybe the most of all," Mr Christopher said. China had "very definitely engaged with us" on the issue, he added.
The Chinese foreign ministry spokesman, Cui Tiankai, replied that Peking was opposed to the use of human rights as an "excuse" to interfere with China's internal affairs.
"Anybody who has a good true genuine understanding of China would conclude that the human rights situation is now the best of all time in China," he said. This was because in "the old days there were some other countries that took part in massive violations" in China.
On Hong Kong, Mr Christopher said the world would be watching when sovereignty was transferred to China next July. Mr Cui countered: "The return of Hong Kong to China will mark the real beginning of human rights being enjoyed by the people of Hong Kong." No other country would have the right to "poke its nose" into Hong Kong's affairs after 1 July next year, he said.
Mr Christopher spoke of "interests we can best advance by working together", and dwelt at length on discussions relating to the non-proliferation of nuclear and conventional arms technology. The US would consider some form of peaceful nuclear co-operation with China even before the 1985 accord was fully implemented.
This might be the reward for China if it stopped selling nuclear technology to Iran including, according to US sources, a uranium conversion facility. China is eager to buy nuclear power reactors from American firms.