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 Xi's busy stop on the West Coast is the first leg of a week-long
trip to the United States and offers him a chance to highlight
China's cooperation with U.S. companies before he heads to
Washington, where he will contend with the full spectrum of
irritants in relations, from tension in the South China Sea to human
rights.
The Chinese leader started the day by publicly assuring U.S.
business leaders that he is making it easier to invest in China, and
he was later quizzed in a private session about intellectual
property protection, common standards and clear, transparent
regulations, according to the Paulson Institute, which hosted the
event.
"We are working to create a new open economic system, push forward
reform of foreign investment management and greatly reduce the
restrictions on foreign investment," Xi told the gathering of
executives in Seattle, including Apple Inc Chief Executive Tim Cook
and Berkshire Hathaway's Warren Buffett.
"GM and Ford can increase their investment in China," Xi said.
A few hours after, Boeing Co announced plans for an aircraft
finishing center in China, its first outside the United States.
 To the east of Seattle, at Microsoft’s campus in Redmond, China's
top Internet regulator told U.S. tech executives that both countries
must work together on cyber security issues, including crime and
espionage, addressing one of their most pressing concerns.
“We are on the same boat,” said Lu Wei, at the eighth annual meeting
of the U.S.-China Internet Industry Forum. “The only choice we have
is to cooperate.”
In a closed-door session afterwards, Lu gave the impression that
China and the United States were set to reach some kind of agreement
on cyber warfare, banning attacks on infrastructure in peacetime,
according to one person present, who asked not to be named given the
privacy of the meeting.
Samm Sacks, an analyst at U.S.-based consulting firm Eurasia Group,
said that American business leaders remain chiefly concerned with
cyber theft targeting corporate secrets, though any renewed cyber
crime dialogue with Washington likely would be limited in scope and
not deal with corporate espionage.
“Overall, I do not see any meaningful progress on cyber issues or a
shift in Beijing's approach toward U.S. tech companies in China,”
Sacks said.
VISITS MICROSOFT CAMPUS, HIGH SCHOOL
Xi later visited Microsoft's campus in Seattle where he was greeted
by co-founder Bill Gates, CEO Satya Nadella and other top
executives.
He was then led to a gathering of American and Chinese CEOs and was
greeted, among others, by Facebook CEO Mark Zuckerberg, who spoke to
the Chinese leader in Mandarin.
The conversation, which was private, lasted about a minute. Facebook
is banned in China.
Although some companies had privately spread word that the meeting
with their CEOs could prove significant and last an hour or more, in
fact it was little more than pleasantries and a photo op.
A Microsoft spokeswoman said that Xi spoke for about six minutes and
that none of the U.S. business leaders responded.
Late on Wednesday, Xi sampled a bit of American teen culture,
visiting Lincoln High School in Tacoma, south of Seattle, along with
first lady Peng Liyuan.
They watched the school’s football team practice before addressing
students in a packed auditorium. Xi urged the students to carry on
the spirit of ping pong diplomacy that 40 years ago was so important
to boosting US-China relations.
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"Ping pong balls are small. Much smaller than the American
football," Xi deadpanned, as the auditorium erupted in laughter.
BOEING TO BUILD PLANT IN CHINA
The world's biggest plane maker's long-expected move into low-cost
China followed its news of a big order for some 300 planes from
China, valued at about $38 billion at list prices.
But the finishing center plan has not been popular with labor unions
and also attracted the ire of leading Republican presidential
hopeful Donald Trump, who said it would take jobs away from the
United States.
Xi toured the Everett, Washington, factory where Boeing its largest
aircraft, and was shown a demonstration on board a 787 Dreamliner,
which is popular with Chinese airlines.
The plant would showcase the new spirit of cooperation touted by Xi,
but several Boeing workers protested outside the Everett plant.
"We don't have a problem with China. We have a problem that this
could equate to machinists losing jobs," said Joel Hetland, 57, a
structures mechanic on the 787, while waving a sign.
"They (Boeing) don't have to worry about the EPA (Environmental
Protection Agency) there, they don't have to worry about human
rights, they don't have to worry about the 40-hour work week."
Boeing said the China facility would not reduce employment on 737
production in Washington state.
INVESTMENT RULES
Xi's comments on foreign investment were designed to please U.S.
business. China has repeatedly pledged to loosen restrictions on
foreign investment as it tries to improve inefficient state-owned
firms and adopt market-friendly policies to stave off slowing
growth, but foreign business groups say that so far action has not
kept pace with promises.
U.S. investors would like a bilateral investment treaty that would
give them increased access to state-dominated industries such as
telecommunications and financial services.
Xi said a key part of China's reforms would be to reduce the scope
of the current "negative list" of industries in which foreigners
could not invest. He added: "Our positive list will be bigger, a
longer list. We will continue to build an open and law-based
environment."
Chinese regulators issued a negative list of prohibited and
restricted industries for foreign investors in March, though
business lobbies have complained that the government has been
reluctant to cede too much control over sectors it deems central to
national interests.
(Additional reporting by Alwyn Scott, Joseph Menn and David
Brunnstrom and Jane Lee; Writing by Bill Rigby and Ken Wills;
Editing by Frances Kerry and Peter Henderson)
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