U.S. President Barack Obama assured China's heir apparent leader that the United States welcomes Beijing's rise in the world, saying Tuesday that strong co-operation between the two powers is good for the rest of the world.

Obama offered a warm welcome to Chinese Vice-President Xi Jinping despite sharp policy differences over Syria, Iran and economic issues. The U.S. reiterated its longstanding concerns over human rights, which Obama described as a "critical issue."

Xi defended the communist-governed country's rights record over the past 30 years, but added: "Of course there's always room for improvement on human rights."

Xi's comments, made at a State Department luncheon after meeting Obama at the White House, were similar to those made by President Hu Jintao — the man he is slated to replace as Communist Party this leader this fall — during a state visit to Washington a year ago.

'We are not always going to see eye-to-eye... but we have very important economic and political concerns that warrant that we work together.'—U.S. Vice-President Joe Biden

Underscoring the sensitivity of the rights issues among China's critics, a few hundred protesters marched outside the White House, waving Tibetan flags and calling for a free Tibet. They held signs proclaiming, "Xi Jinping: Tibet will be free." They shouted "Shame on Chinese government" and "Stop lying to the world."

But Xi's unusually long and high-level visit to the United States reflected the stature he is set to assume, and the importance the Obama administration puts on building ties with Beijing. Both sides stressed the importance of stable relations between the two global powers, and their ability to air differences without recrimination.

"We welcome China's peaceful rise," Obama said as the two men sat in the Oval Office. "We believe that a strong and prosperous China is one that can help to bring stability and prosperity to the region and to the world."

Obama said he looks forward to future co-operation.

'Deepen the friendship'

A smiling Xi told Obama he wants to build on the past relationship between Obama and Hu and "deepen the friendship" between the people of the two countries.

China's Vice-President Xi Jinping, who will take over the presidency from Hu Jintao next year, is visiting the U.S. to meet President Barack Obama and other leaders, and introduce himself to a U.S. audience. (Aliosha Marquez/Associated Press)

"I hope to engage with a broad cross-section of American society during my current visit so as to deepen mutual understanding, expand consensus, strengthen co-operation and deepen the friendship between the Chinese and American people," Xi said, a reference to an itinerary that includes stops in the states of Iowa and California.

Xi's visit is being closely watched because he will likely lead China over the coming decade. After becoming party leader, he is expected to replace Hu as president in 2013.

In the years ahead, the U.S. and China are likely to see their economic ties grow even as they are viewed increasingly as military rivals.

"We are not always going to see eye-to-eye. We are not always going to see things exactly the same, but we have very important economic and political concerns that warrant that we work together," Vice-President Joe Biden said as the talks began at the White House.

Xi has impeccable Communist Party credentials as the son of a famed revolutionary, but is viewed as more able to make personal connections than Hu and more willing to step away from the traditional aloofness of Chinese high office.

While Xi's trip is unlikely to herald any policy changes it may signal his leadership style. Other than his genial demeanour, he revealed little in his rather staged appearances at the White House — although Obama let on that Xi may take in an LA Lakers professinal basketball game when he visits Los Angeles toward the end of his trip.

Later Tuesday, Xi was meeting with Defence Secretary Leon Panetta, who will be hoping to inject some vigour into halfhearted ties between their two militaries. Washington will need to convince a skeptical Beijing that an adjustment in U.S. foreign policy to emphasize the economically booming Asia-Pacific region is not aimed at containing the rise of China.

Military buildup

For its part, China needs to convince the U.S. and many Asian nations that they need not fear its two-decade military buildup.

Biden and Obama also discussed with Xi some thorny foreign policy issues, including North Korea, Iran and Syria. Last week China joined Russia in vetoing a UN Security Council resolution pressuring Syrian President Bashar Assad's government over its violent crackdown on opponents.

Xi said that a greater part of his discussions with Obama and Biden were on economic and trade issues. He said that the U.S. and China shared the view that the international ecnonomic and financial situation remains "grim." He said ensuring growth and promoting employment were high on the domestic agenda of both countries.

The key American concerns are the vast trade imbalance between the world's two largest economies, and Chinese trade rule violations. The U.S. also reiterated problems with intellectual property theft and the value of China's currency. The yuan has gained a little against the dollar in the past 1 1/2 years but still is viewed by Washington as undervalued to boost the exports that still drive China's economy.

With Obama vying for re-election this November, Republican presidential front-runner Mitt Romney is already accusing the incumbent of being soft on China at the expense of a still-fragile U.S. economy.

Alongside Xi, Obama stressed the "importance of working by the same rules of the road when it comes to the world economic system."

Xi said the U.S. and China should "strive for greater balance in trade and investment between the two countries."

Despite the wide array of issues at hand, U.S. officials see Xi's visit primarily as an investment in relationship-building, both on the personal level and to advance a three-year push for co-operative ties with Asia's emerging superpower.