Satellite photographs taken earlier this month show China is appearing to carry out preparatory work on a third airstrip on one of several artificial islands in the disputed waters.

China’s island building programme coincides with its increasingly aggressive posturing over the South China Sea, which it claims in almost its entirety, much to the anger of its Asian neighbours C and the US.

Beijing is also embroiled in a bitter territorial dispute with Japan over tiny islets in the East China Sea, where it has set up an Air Defence Identification Zone (ADIZ).

Despite Ms Rice’s comments, China’s willingness to confront its neighbours has caused concern in Washington, which has been carrying out a military and political ‘pivot’ to Asia in recent years.

Richard Bitzinger, a regional security expert at the S.Rajaratnam School of International Studies in Singapore, told The Telegraph the Xi is attempting to “alleviate US concerns” with his “fence-mending expedition”, but that does not mean he will give way.

“Xi is also not going to back down from his increasingly assertive, even aggressive, stances,” Mr Bitzinger said.

“He's a nationalist, pure and simple, and he's in the USA to convince Washington of that as well.” 

Cybersecurity

China shut down a bilateral cyber security working group last year when the US charged five Chinese military officers with hacking American firms, underscoring the deep distrust that exists between the two sides over cyberspace.

Tensions mounted further earlier this summer after an attack on the US government's Office of Personnel Management, which compromised the personal date of four million people.

"This isn't a mild irritation," Ms Rice said, speaking about concerns that Beijing is at the centre of large-scale cyber-theft. "It's an economic and national security concern."

The issue has been a major stumbling block between forging closer relations between the two nations, but Obama has stepped back from targeting Chinese firms and individuals with sanctions.

Hopes that a “minimal consensus on cybersecurity” might become a reality increased with Mr Xi’s decision to send senior official Meng Jianzhu to the US for talks ahead of the president’s visit, Jean-Pierre Cabestan, professor of government and international studies at Hong Kong Baptist University, said.

“His (Xi’s) interest is to tone down the bones of bones of contention, to show openness and to demonstrate a willingness to talk about anything and negotiate the burning issues,” Prof Cabestan told The Telegraph.

Chinese state media is also building up hopes of an agreement, but frustrations remain on the “double standards” from Washington on cybersecurity.

“It accuses other countries, especially China, of industrial espionage or other cyber attacks while the US monitors other countries' senior officials or political figures almost constantly," Wu Xinbo, director of the Centre for American Studies at Shanghai’s Fudan University, told the Global Times newspaper.

Trade and investment

“I think it is noteworthy that he visited the big Boeing plant in Seattle,” said Mr Bitzinger, referring to the early stage of Mr Xi’s visit on the American West Coast.

“China is Boeing’s biggest single customer which is worth billions in US exports, and he is not letting the USA forget that.”

Chinese firms signed $38billion (￡25billion) worth of deals for 300 aircraft this week, the latest huge outlay highlighting the country’s economic importance to the US.

Boeing forecasted last month that China will need 6,330 new airplanes over the next 20 years, worth a massive $950 billion.

China-US trade reached $555.1billion last year, and Mr Xi may feel as if he is in the driving seat with regards to long-running negotiations over a bilateral investment treaty between the two countries.

China is hoping for more US investment C particularly in high-tech industries.

It also wants the US to shed some of its security reviews and other “burdens and obstacles” for potential Chinese investors, and to loosen import restrictions.

But there are major concerns about the strength of the Chinese economy, with both the Asian Development Bank and the International Monetary Fund lowering their forecasts for Chinese growth.

China is expected to struggle to meet its seven per cent target for this year, after it revised its 2014 growth figure to 7.3 per cent, the lowest in 24 years.

"In the long run the fundamentals of the Chinese economy are good," Xi told a meeting of top executives from both countries in Seattle.

However, Prof Sonny Lo, from the Hong Kong Institute of Education, said: “The US strategic think tanks will doubt this, given the momentum and structural conditions of the Chinese economy.Technology bosses meet Xi Jinping in America  Photo: AP

China’s seat at the ‘top table’

British chancellor George Osborne said on his visit to China this week that the Asian giant deserves to “take its place at the top table”.

Mr Osborne, not for the first time during his trip, delighted his Chinese hosts by urging US Congress to back quota and governance reforms of the International Monetary Fund (IMF), which would see more power given to emerging economies like China.

Osborne also spoke of his pride in leading Britain into the Asian Infrastructure Investment Bank (AIIB) C the first major Western economy to join the China-led institution, which is expected to be launched next year.

The US views both the AIIB - which will have a capital of $100billion and has already attracted most of the major European economies as prospective members - and China’s demands for more influence with the IMF with suspicion.

“It worries that China’s rise may pose a threat to its dominance in the world,” Xu Winbo said.

Mr Xi said in an interview in the Wall Street Journal this week that he wants the US to help China “improve” the global system.

“This will not only leverage our respective strengths to enhance cooperation, but also enable our two countries to jointly respond to major challenges facing mankind,” he said. 

Former US Federal Reserve chairman Ben Bernanke previously suggested that the US Congress’ decision to block reform of the IMF pushed China into creating the AIIB.

“I understand why other countries say, ‘well let’s take our marbles and go home,’” he said.

The Obama administration - which backs the IMF reforms C appeared outmaneuvered as it watched its global partners falling over themselves to sign up to the AIIB.

Which means that Obama may be forced to engage in some ‘fence-mending’ himself on this point, if he is to secure Chinese support on his own objectives.