Obama says US, China must develop cyber rules

RANCHO MIRAGE, Calif. (AP) ? President Barack Obama told Chinese President Xi Jinping on Friday it is critical to reach a "firm understanding" of how they will work together on cybersecurity, a contentious issue between the world powers.

The Chinese leader said China itself had been a victim of cyberattacks and agreed the two countries share concerns about the security issue.

Obama and Xi met for more than two hours at a 200-acre desert resort at the opening of a two-day summit, their first face-to-face talks since the Chinese leader took office in March.

Describing the issue as "uncharted waters," Obama said it is critical that the U.S. and China develop rules for cybersecurity and arrive at a "firm understanding" of how to work together on security issues.

Although Obama said he and the Chinese leader had yet to delve fully into discussions about cybersecurity, he said advances in technology have created a need for clear protocols about what is and isn't acceptable for governments to do.

"They're going to have similar concerns," Obama said of the Chinese.

Pushing back against the notion that the controversy over widespread government surveillance by the U.S. undercut his credibility to take on China over cybersecurity, Obama insisted the two issues were different. He said concerns over hacking and intellectual property theft shouldn't be confused with the separate debate over how governments collect data to combat terrorist threats.

"That's a conversation that I welcome," he said.

China, too, has major concerns about cybersecurity, Xi said, calling new technology a "double-edged sword" that can drive progress but can also cause headaches for governments and their regulators. Although he said China has been victimized by cyberattacks, he did not specify who may have perpetrated him.

Speaking more broadly, Xi said he and Obama believe the two coutnries can approach each other in a way "that is different from the inevitable confrontation and conflict."

Obama said China's "peaceful rise" is in the interest of the United States.

Putting a positive spin on what has been a troublesome issue between the U.S. and China, Xi said cybersecurity is an area for the two nations to work together pragmatically. He said he was pleased that the U.S. and China have established a working group to discuss cybersecurity and called for the two nations to pay close attention to the issue as they work to resolve it going forward.

He invited the U.S. president to come to China for a similar meeting, pledging to continue talking by phone and exchanging letters with Obama.

Emerging from the first working session of their two-day summit, Obama and Xi avoided direct public confrontations but signaled the significance of the issue in their relationship.

Hours earlier, with temperatures surging above 100 degrees, the two leaders walked together under a shaded walkway as they marked the start of their desert meetings. Underscoring the desire for an informal summit free of the formalities that mark official state visits, Obama and Xi greeted one another in white shirts and suit coats, but no ties.

"Our decision to meet so early (in Xi's term) signifies the importance of the U.S.-China relationship," Obama said. He noted the unusual setting and said he hoped for "more extended" and informal talks that will lead to a "new model of cooperation" between countries.

Previewing their talks, Obama said the United States is seeking an economic order "where nations are playing by the same rules, where trade is free and fair, and where the United States and China work together to address issues like cybersecurity and the protection of intellectual property."

Obama, seated next to Secretary of State John Kerry, said he would also stress the importance of human rights, another sensitive issue with the Chinese.

For his part, Xi did not mention cybersecurity, human rights or North Korea, another area of potential tensions between the two powers.

Speaking through a translator, Xi said both leaders were "meeting today to chart the future of U.S.-china relations." He added that the world has "reaped huge benefits" for the relationship between both countries.

While the summit was billed as an informal meeting, the first round of talks looked and felt like a standard diplomatic encounter. Obama and Xi sat on opposite sides of a long rectangular table, each flanked by about a dozen aides. Pairs of U.S. and Chinese flags were stationed at the head of the table and note-takers sat off to the side.

U.S. manufacturers have long contended that China is manipulating its currency to gain a trade advantage. The U.S. trade deficit with China is the largest with any single nation. The U.S. government, however, has declined to label China a currency manipulator in an effort to narrow the trade deficit through negotiation rather than confrontation.

On the issue of cybersecurity, the U.S. has started bringing its complaints about persistent Chinese computer-hacking into the open after years of quiet and largely unsuccessful diplomacy. It has accused Beijing's government and military of computer-based attacks against America. While there have been no actual admissions of guilt, Chinese leaders have started acknowledging there is a problem and U.S. officials say the Chinese seem more open to working with the U.S. to address it.

"Inevitably there are areas of tension between our countries," Obama said, adding that it's in the interest of both countries to work together.

But China has asserted they, too, are often the victim of cyberattacks, including those that could be emanating from the U.S. ? a line of argument that could be emboldened by new revelations that the U.S. extensively scours the Internet usage of foreign nationals overseas.

Obama, seeking to keep the issue from overshadowing the China meetings, addressed the surveillance programs for the first time hours earlier. "You can't have 100 percent security and then also have 100 percent privacy and zero inconvenience. We're going to have to make some choices as a society," he said during a health care event in Northern California.

The two leaders were meeting at the Sunnylands estate just outside Palm Springs, Calif., where they were set to hold additional talks on Saturday morning.

U.S. officials see Xi, who took office in March, as a potentially new kind of Chinese leader. He has deeper ties to the U.S. than many of his predecessors and appears more comfortable in public than the last president, Hu Jintao, with whom Obama never developed a strong personal rapport.

As the meetings continue, Obama will also be looking to build on Xi's apparent impatience with North Korea's nuclear provocations. The U.S. has welcomed Xi's recent calls for North Korea to return to nuclear talks, though it's unclear whether Pyongyang is ready to change its behavior.

Xi is likely to press China's claims of business discrimination in U.S. markets and to express concern over Obama's efforts to expand U.S. influence in the Asia-Pacific region, which China sees as an attempt to contain its growing power.

Obama and Xi first met before the Chinese leader took office in March. They weren't slated to meet again until September, on the margins of an international economic summit in Russia, but both countries saw a need to move up their first meeting of the year, given the myriad issues that define their relationship.

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Associated Press writer Darlene Superville contributed to this report.

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Follow Julie Pace at http://twitter.com/jpaceDC

Source: http://news.yahoo.com/obama-says-us-china-must-develop-cyber-rules-034227038.html

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