On January 1, 1979, China and the United States officially established diplomatic relations at the ambassadorial-level. Twenty-seven days later, then Vice Premier Deng Xiaoping paid a visit to the United States. During Deng's visit, the two sides reached a series of cooperative agreements with regards to the economy, culture, science and technology. Deng commented, "There are still many areas between our two countries in which we can cooperate and there are lots of channels through which we can communicate. We must continue our efforts." He noted, "China is open for all of our friends." Indicative of this spirit, China has set about realizing its opening-up imperative for the past 30 years.

On August 17, 1982, China and the U.S. issued a joint communiqué, the third such communiqué between the two nations. It was declared the two sides would gradually reduce the level of and finally stop U.S. arms sales to Taiwan. This reaffirmed the essential principles guiding bilateral ties established in the first two communiqués. The United States also emphasized its acknowledgement of the One-China policy, as it had done in the 1972 and 1979 communiqués. This policy together with the other cardinal principles guiding bilateral ties set in the three communiqués cemented the political foundation for the sound development of China-U.S. relations.

Strategically speaking, for the two countries to bring about full reconciliation and cooperation, there was a need to deal with the issue of the Soviet Union and its relationship with the two nations. However, the disintegration of the Soviet Union in 1991 precipitated a deterioration in China-U.S. relations as ideology once again reasserted itself over pragmatism. "To contain China" became the new U.S. policy toward this emerging East Asian country. In the early 1990s there was nevertheless continued contact between the two countries and the most favored nation treatment granted by the U.S. to China was not revoked.

In October 1997, President Jiang Zemin made a state visit to the United States, putting an end to eight years of strained bilateral relations and outlining his wishes for the future of bilateral ties into the 21st century. The two sides announced that they would work together to build a constructive strategic partnership for the new millennium. Subsequent U.S. leaders have continued to support strong bilateral relations. President George W. Bush visited China once in October 2001 and again in February 2002. On both these occasions key decisions for the good of the relationship were made.

After the 9/11 terrorist attacks and with the specter of terrorism hanging over its cities, the United States reinterpreted its position on China to regard it as an important strategic partner. U.S. officials sought to establish constructive partnerships with their Chinese equivalents to confront terrorist threats.

Since that time, China's international influence has kept growing. After taking office in 2009, President Barack Obama continued with proactive policies toward China. Obama was especially compelled to do so by the deteriorating state of the U.S. economy.

At the April 2009 G20 summit, leaders of the two countries agreed to build a positive, cooperative and comprehensive relationship for the 21st century. On Obama's visit to China in 2009, both parties pledged to take concrete actions to steadily build a partnership to address common challenges, marking a new high water mark in their relationship.

Objectively speaking, the relaxation of the tensions between China and the United States 40 years ago was the result of influential policymakers seeking greater balance in the international diplomatic arena. This left a pragmatic tradition through which both sides could push forward ties.

The past 40 years have been periods of great upheavals and restructurings in the international diplomatic landscape. The cold war status quo collapsed. While "Chimerica," to use a term coined by noted British historian Niall Ferguson, has had its shares of ups and downs, the growing interdependency between the two nations' economies has ensured long-term momentum towards improvement in ties.

In the first decade of the new century and especially after the onset of the global financial crisis, the economic fortunes of the two countries have also changed remarkably. In contrast to the sluggish U.S. economy, China's economy has maintained a robust growth trajectory and became the world's second largest economy in terms of GDP. Because of this, China-U.S. relations have assumed their most dynamic and significant form since the cold war ended. Bilateral ties have also broadened to touch on issues of competition and cooperation at multiple levels of government and business and now encompass the economy, trade, exchange rate issues, military affairs, food safety, energy and resources, climate change, environmental protection and exchanges in social sciences.

From January 19 to 22, 2011, President Hu Jintao paid a state visit to the United States. The two sides issued a China- U.S. Joint Statement, agreeing to build a China-U.S. cooperative partnership based on mutual respect and mutual benefit and initiating a new stage of "seeking progress in change" for the continued development of China-U.S. relations. As China's ambassador to the United States Zhang Yesui noted, "mutual respect and mutual benefit" is a phrase that fully embodies the requirements of our times.

In the three years after the outbreak of the global financial crisis, the two countries' leaders have met 10 times, and have continued communications through telephone calls and correspondences, and more than 60 negotiation dialogue mechanisms have been established. Economic and trade exchanges between the two sides have also been increasingly frequent. Nowadays, with both countries being each other's second largest trade partners, total trade volumes in 2010 reached US $385.3 billion – 160 times the trade volume when diplomatic relations were first established. People-to-people exchanges are also increasing – more than 110 flights cross the Pacific weekly, shuttling around three million people back and forth every year. Cooperation between the two countries over international and regional issue is also at a high point.

The Good, the Bad and the Ugly

Over 40 years, China-U.S. relations have developed to maturity. Nevertheless, a look at the fine print shows that cooperation between the two nations has at times been plagued with disputes and disagreements. Far from signaling a deterioration of ties, however, these issues attest to the complexity and arduousness of relations between these two countries with dramatically different histories and outlooks.

China's economic development has prompted the U.S. to reassert its leadership in global affairs as the world's only super power post-USSR. Its domestic businesses continue to innovate and attract the world's best talent, and the U.S. government has sought to maintain its dominant role in world politics and economics with proactive foreign policy. This however has not taken the wind out of the sails of the Middle Kingdom's rapid development – China, as a nation with a radically different political system and ideology, continues to go its own way. Although the so-called "China Model" has drawn some criticism in the West, it has proved its mettle, and the merits of the model have become even more salient in the wake of the ongoing financial crisis. This provides the backdrop for the current China-U.S. relationship.

As trade and economic issues between the two countries have become increasingly complex, the Renminbi exchange rate has become a perennial topic of debate. As the issue of "rebalancing trade" has drawn more and more attention in the United States, the focus of bilateral trade and economic disputes has shifted to the issue of the exchange rate and frictions have arisen. In 2003, the U.S. Congress first proposed a draft bill on the value of Renminbi, accusing China of manipulating it. Following this falling out, the two governments have exchanged many opinions on the issue.