Biden and China's Xi discuss avoiding conflict in call

US President Joe Biden and Chinese leader Xi Jinping spoke for 90 minutes, in their first talks in seven months, discussing the need to ensure that competition between the world's two largest economies does not veer into conflict.

The US side said the "proof will be in the pudding" as to whether the stalemate can be broken with ties between the superpowers languishing at their lowest point in decades.

In a statement, the White House said Biden and Xi had "a broad, strategic discussion," including areas where interests and values converge and diverge. The conversation focused on economic issues, climate change and COIVD-19, a senior US official told reporters.

"President Biden underscored the United States' enduring interest in peace, stability, and prosperity in the Indo-Pacific and the world and the two leaders discussed the responsibility of both nations to ensure competition does not veer into conflict," the White House added.

Occasional high-level meetings since Xi and Biden's first call in February have yielded scant progress on issues ranging from human rights to transparency over the origins of COVID-19.

In the months since, the two sides have lashed out at each other almost constantly, often with vitriolic public attacks, sanctions on officials and criticism over not upholding international obligations.

Chinese state media said Xi had told Biden that US policy on China imposed "serious difficulties" on relations, but added that both sides agreed to maintain frequent contact and ask working-level teams to step up communications.

"China and the United States should ... show strategic courage and insight, and political boldness, and push Sino-U.S. relations back to the right track of stable development as soon as possible," state media said, citing Xi.

Asian currencies and share markets strengthened, as investors speculated that the call could bring a thaw in ties between the two most important trading partners of regional economies.

Xi said that if "core concerns" on both sides were respected, diplomatic breakthroughs could still be made in the area of climate change, adding that the issue could add "positive factors" to the relationship.

During a visit to China by Biden's top climate envoy John Kerry last week, senior diplomat Wang Yi said climate change was an "oasis" in China-US relations but it could not be separated from broader disputes.