China and the United States started their fifth strategic economic dialogue (SED) in Beijing Thursday amid the deepening global financial crisis and the transition of the US government.

Chinese Vice Premier Wang Qishan  and the US Treasury Secretary Henry Paulson co-chaired the dialogue on Thursday morning as special representatives of President Hu Jintao and President George W. Bush.   

The two-day Fifth China-US Strategic Economic Dialogue is opened in Beijing, December 4, 2008. [Pang Xinglei/Xinhua]

"The most pressing issue we have to deal with is coping with global financial turmoil," Wang said before going behind closed doors.

"It is imperative for us to work together to implement the consensus reached at the G20 summit," Wang said, referring to a financial meeting of leaders from the 20 richest countries and emerging economic markets in Washington D.C. in mid November.

For the first time during the SED, Paulson said the United States and China will focus on how they work together through international forums to strengthen the global economic system.

As the global crisis looms large, Wang said the priority was to restore investor confidence as soon as possible, restrain the crisis from spreading, and avoid a global economic recession, with special regard for the impact that it will have on developing countries.

"The United States was aware that to get rid of the financial turmoil, China's cooperation, support and help was indispensable," said Zhou Shijian, a senior researcher with Beijing-based Tsinghua University.

This round of SED talks also came at a time that the new US administration was taking over responsibilities.

"This will be the final SED meeting for me and my US cabinet colleagues, and we are committed to a strong finish," said Paulson, a key figure in establishing the SED mechanism in 2006.

Paulson said this round of dialogue would be "our most productive and cooperative sessions to date."

"The Obama team had already been briefed on the importance of the SED," said US Assistant Secretary of State Daniel S. Sullivan. "The transition between the Bush administration and the Obama administration is very closely coordinated."

The two-day dialogue will focus on the building blocks for enduring the US-China economic partnership.

Despite the grave global financial turmoil, China-US trade still kept a strong momentum as bilateral trade volume rose by 13.6 percent in the first ten months to 281.3 billion US dollars. The United States stood as China's second largest trade partner, behind the European Union.

Wang urged the United States to "go all out to stabilize the economy and the financial market, and ensure the safety of China's assets and investment in the United States."

The Chinese delegation to the dialogue included more than 10 ministers of finance, development and reform, agriculture, labor, commerce, health, environment, and the central bank among others.

Among the US high-profile trade mission were cabinet secretaries of agriculture, labor, health, environment, among others. The US Trade Representative Susan Schwab also took part.

At six sessions, they will work on strategies for managing macroeconomic risks and promoting balanced growth, on open investment and trade policies, including strengthening products, food and drug safety, on respected roles in international institutions and to strengthen cooperation in energy and the environment.

The talks were expected to "reach substantive agreements", Paulson said, detailing them as "establishing short, medium, and long-term deliverables in five areas: electricity generation, transportation, clean water, clean air and protecting wetlands and natural areas."

President Hu and Premier Wen Jiabao are expected to meet with the US delegation Friday afternoon.

The twice-yearly SED, initiated by the two presidents, is currently the highest-level economic dialogue between the two nations.