The renewed sense of strategic trust peaked in the U.N. climate talks in Lima, Peru, when President Obama and President Xi Jinping announced the new China-US climate change targets. Beijing's new targets are in line with China's transition from extensive growth based on investment and net exports, to intensive growth as defined by consumption and innovation.

In the United States, the proposed target is significantly more ambitious than President Obama's previous "U.S. Climate Action Plan." Politically, it is leading to a showdown with the newly Republican-controlled Congress. The bilateral climate pact signaled that the president, "has no intention of moving towards the middle," Senate Republican Leader Mitch McConnell complained after the deal. On Capitol Hill, things will get more heated as Republican Senator James Inhofe, one of Congress's most prominent climate change skeptics, will succeed Democratic Senator Barbara Boxer as chair of the Environment and Public Works Committee in the Republican-led Senate.

The bilateral climate deal is a harbinger of future Sino-U.S. relations. What President Obama hopes to build, his opposition seeks to undermine.

Progress in trade, economic cooperation and security

In addition to the climate deal, there has been bilateral progress in trade and security issues. In November, the successful summit meeting between President Xi Jinping and President Obama led to expanded military confidence-building measures, while efforts intensified to complete the bilateral investment treaty (BIT).

In security issues, progress has been evident, albeit not linear, in the US-China military-to-military relationship. However, deep bilateral differences remain over cyber activities, in which Washington sees itself as a victim of "commercial theft," while Beijing perceives itself under incessant cyber intrusions by the U.S. National Security Agency (NSA), as evidenced by the Snowden disclosures.

Bilateral differences also prevail over Washington's efforts to curb Iran's nuclear program, the sanctions against Russia and the expansion of the NATO in Ukraine, the crisis in Syria and the Middle East, U.S. stance in Afghanistan and Pakistan, as well as the role of North Korea.

In economic and trade issues, the subtext of bilateral relations has shifted, thanks to China's reforms, as I argued a year ago. More recently, China's new reform and opening policies have changed the very terrain of Sino-U.S. relations. The role of bilateral trade deficits has been overshadowed by the rapid rise of China's foreign direct investment (FDI) in the U.S. As efforts to accelerate innovation-led competitiveness have been stepped up in the mainland, IPRs play an increasing role in Chinese industrial policy as well.

And as the U.S. recovery is broadening, rounds of quantitative easing (QE) have ended at the Fed, which is paving way for hiked rates after mid-2015. As a result, the U.S. dollar is strengthening and bilateral currency debates are fading away.

Source of documents：China.org.cn