Bali, Indonesia CNN  — 

When Joe Biden and Xi Jinping first got to know each other more than 10 years ago, the US and China had been moving closer for three decades despite their differences.

“The trajectory of the relationship is nothing but positive, and it’s overwhelmingly in the mutual interest of both our countries,” Biden said in 2011 when, as vice president, he visited Beijing to build a personal relationship with China’s then leader-in-waiting.

Seated next to Xi in a Beijing hotel, Biden told a room of Chinese and American business leaders about his “great optimism about the next 30 years” for bilateral relations and praised Xi for being “straightforward.”

“Only friends and equals can serve each other by being straightforward and honest with them,” he said.

On Monday, the two leaders are set to meet each other for another honest exchange in Bali, Indonesia, on the sidelines of the Group of 20 summit. But the mood in the room is unlikely to be as balmy as the surrounding location.

The positivity and optimism of a decade ago has been replaced by mutual suspicion and hostility. When Biden returned to the White House as President, he was handed a US-China relationship in its worst shape in decades, with tensions flaring across trade, technology, geopolitics and ideology.

Xi Jinping and Joe Biden meet in Beijing in 2011.

The upcoming meeting – the first in-person encounter between Biden and Xi since the US President took office – comes at a crucial time for both leaders. Having further consolidated his power at last month’s Communist Party Congress, Xi is heading into the meeting as the strongest Chinese leader since Mao Zedong.

Biden, meanwhile, arrived in Asia following a better-than-expected performance by his party in the US midterm elections – with the Democrats projected to keep the Senate in a major victory. Asked Sunday whether the results allowed him to go into Monday’s face-to-face with a stronger hand, Biden voiced confidence. “I know I’m coming in stronger,” he told reporters.

The stakes of their much-anticipated meeting are high. In a world reeling from Russia’s invasion of Ukraine, the Covid-19 pandemic and the devastation of climate change, the two major powers need to work together more than ever to instill stability – instead of driving deeper tensions along geopolitical fault lines.

But expectations for the meeting are low. Locked in an intensifying great power rivalry, the US and China disagree with each other on just about every major issue, from Taiwan, the war in Ukraine, North Korea, the transfer of technology to the shape of the world order.

Perhaps the only real common ground the two sides share going into the meeting is their limited hopes for what might come out of it.

A senior White House official said Thursday Biden wants to use the talks to “build a floor” for the relationship – in other words, to prevent it from free falling into open conflict. The main objective of the sit-down is not about reaching agreements or deliverables – the two leaders will not release any joint statement afterward – but about gaining a better understanding of each other’s priorities and reducing misconceptions, according to the US official.

US national security adviser Jake Sullivan reinforced the message Saturday to reporters aboard Air Force One, noting the meeting is unlikely to result in any major breakthroughs or dramatic shifts in the relationship.

Hopes for a reset with Washington are similarly low in Beijing. Shi Yinhong, an international relations professor at Renmin University, said it would be an “enormous over-expectation” to believe the meeting can lead to any lasting and significant improvement in bilateral ties.

“Given that China and the US are in a state of near-total rivalry and confrontation, there is not much possibility to anticipate that the major issues can be truly clarified,” Shi said.

US President Joe Biden has spoken with Chinese leader Xi Jinping five times over the phone or video call since taking office in January 2020.

At the center of their divergence is how the two nations view each other’s motives – and how detrimental these goals are to their own interests.

“The Chinese believe the US goal is to keep China down so we can contain it. And the US believes China’s goal is to make the world safer for authoritarian states, push the US out of Asia and weaken its alliance system,” said Scott Kennedy, senior adviser in Chinese business and economics at the Center for Strategic and International Studies (CSIS) in Washington.

Each side blames the other entirely for the state of the relationship and each believes they are faring better than the other in the situation, said Kennedy, who has recently returned from a weeks-long visit to China – a rare opportunity in recent years due to China’s zero-Covid border restrictions.

“The Chinese think they’re winning, the Americans think they’re winning, and so they’re willing to bear these costs. And they think the other side is very unlikely to make any significant changes,” Kennedy said. “All of those things reduce the likelihood of significant adjustments.”

But experts say the very fact that the two leaders are having a face-to-face conversation is itself a positive development. Keeping dialogue open is crucial for reducing risks of misunderstanding and miscalculations, especially when suspicions run deep and tensions run high.

Direct communication is all the more important given Xi has just secured a norm-shattering third term with a tighter grip on power than ever – and a possibility to rule for life. “There is no one else in their system who can really communicate authoritatively other than Xi Jinping,” national security adviser Sullivan said.

‘Red lines’

On Wednesday, Biden told a news conference that he wants to “lay out what each of our red lines are” when he sits down with Xi, but experts say that might not be as straightforward as it sounds.

“I would love to be a fly on the wall to see that conversation because I don’t think that the US or China has been very precise about what its red lines are. And I also don’t think either has been very clear about what positive rewards the other side would reap from staying within those red lines,” said Kennedy, of CSIS.

For Beijing, no red line is starker or more crucial than its claim over Taiwan – a self-governing democracy the Chinese Communist Party has never controlled. Xi views “reunification” with the island as a key unresolved issue on China’s path toward “great rejuvenation,” a sweeping vision he has vowed to achieve by 2049.

And perhaps no American President has angered Beijing over Taiwan in recent decades more than Biden, who has said – on four separate occasions – the US will defend the island in the event of a Chinese invasion. Each time, his aids have rushed to walk back his remarks and denied any changes in the US’ “One China” policy.

Under the “One China” policy, Washington acknowledges Beijing’s position that Taiwan is part of China, but has never accepted its claim of sovereignty over the island. The US provides Taiwan defensive weapons, but has remained deliberately vague on whether it would intervene militarily if China attacks the island – a policy known as “strategic ambiguity.”

US House Speaker Nancy Pelosi with Taiwan's President Tsai Ing-wen during her visit to Taipei this August.

China has repeatedly accused the US of “playing with fire” and hollowing out the “one China” policy. Beijing’s anger reached a boiling point in August, when US House Speaker Nancy Pelosi brushed aside its stern warnings and landed in Taipei for a high-profile visit.

China responded by launching large scale military exercises around Taiwan that formed an effective blockade; it also halted dialogue with the US in a number of areas, from military, climate change and cross-border crime to drug trafficking.

Now the two leaders are sitting down in the same room – a result of weeks of intensive discussions between the two sides – Taiwan is widely expected to top their agenda. But in a sign of the contentiousness of the issue, barbs have already been traded.

Biden has said he would make no “fundamental concessions” to Xi, and Sullivan has announced plans to brief Taiwan about the talks with an aim to make Taipei feel “secure and comfortable” about US support.

That plan drew immediate condemnation from Beijing. “It is egregious in nature. China is firmly opposed to it,” Chinese foreign ministry spokesperson Zhao Lijian said Friday, shortly after the ministry confirmed that Xi would meet Biden at the G20.

The rocket force of China's People's Liberation Army conducts missile tests into the waters off the eastern coast of Taiwan on August 4.

“The problem with China is they don’t like to meet and exchange views – they just repeat talking points. Xi Jinping is not very creative in the way he interacts with his counterparts,” said Jean-Pierre Cabestan, a professor of political science at Hong Kong Baptist University.

Other key topics on the agenda include Russia’s war in Ukraine – another significant point of tension, as well as areas where the US hopes to cooperate with China – such as North Korea’s ongoing provocations and climate change.

Shi, the Chinese expert at Renmin University, sees little room for breakthroughs on these issues.

“On the issue of Ukraine, China has already made its position clear many times. It will not change simply because of the talks with the US President. On North Korea, since March last year, China has already stopped treating the denuclearization of North Korea as a fundamental element of its Korean Peninsular policy,” he said.

Nor is his assessment for climate cooperation any rosier. “China and the US can find many common interests on this, but when it comes to how to deal with climate change specifically, it always leads to antagonism on policies and rivalry over ideology and global influence,” Shi said.

Experts in the US and China say some progress on greater communication and access between the two countries will already be considered a positive outcome – such as restoring suspended climate and military talks.

“Hopefully the meeting can be used for more than just airing mutual grievances,” said Patricia Kim, a China expert at the Brookings Institution. “For instance, a joint declaration by Biden and Xi that they oppose the threat or use of nuclear weapons in Ukraine and on the Korean Peninsula, as well as a nod to restarting working-level exchanges on areas of common interest such as climate change and counter-narcotics would be promising.”

Personal relationship

Over the decade of their relationship, Biden and Xi have spent dozens of hours together across the US and China.

During Biden’s getting-to-know-you trip to China in 2011, the two leaders shared a marathon of meetings and meals in Beijing and the southwestern city of Chengdu. They also took a trip deep into the green mountains of Sichuan province to visit a rural high school rebuilt after a deadly earthquake.

The next year, Xi paid a reciprocal visit to the US at the invitation of Biden, who hosted his Chinese counterpart for dinner at his residency after a series of meetings at the White House, State Department and the Pentagon. Biden also flew to Los Angeles to meet Xi on the last leg of his trip.

Their in-person encounters continued after Xi took power in 2012. The last time they met face to face was in 2015, during Xi’s first state visit to the US as China’s top leader.

As relations between their countries plummeted, the once friendly dynamics between the two leaders have also shifted.

Xi Jinping and Joe Biden, accompanied by their translators, in Chengdu, China, in 2011.

Xi is an ideological hardliner who believes in China’s return to the center of the world stage and is skeptical – some would say hostile – toward America. Biden, meanwhile, has grown increasingly weary of China’s authoritarian turn under Xi, and has framed the rivalry between the two countries as a battle between autocracy and democracy.

Last summer, Biden publicly pushed back on being described as an “old friend” of Xi’s.

“Let’s get something straight. We know each other well; we’re not old friends. It’s just pure business,” he said at the time.

Given the growing divide, the two-year gap since their last in-person meeting is an extremely long time, Kennedy pointed out.

“One conversation on the sidelines of a multilateral summit is still insufficient to fully discuss all the key issues that the countries face. And so hopefully, the two sides will facilitate a greater discussion on these issues by many parts of the two governments.”

CNN’s Kevin Liptak contributed to this story.