Relations among governmental departments also change with each new presidential administration. The U.S. State Department, Department of Defense and National Security Council have a history of fighting for dominance in policymaking. Which department gains the upper hand will affect the U.S. China policy. Entering the 21st century, other departments like the Department of the Treasury, Department of Commerce, Department of Energy, Department of Homeland Security and the various intelligence agencies are also playing more important roles.

The third variable is the shifting American political landscape. The Democratic victory resulted from public rejection of the Bush administration's policies as well as demographic changes in society. Non-white people now make up 34 percent of the total U.S. population, up from 23 percent 10 years ago. In addition, aging baby boomers are putting more pressure on the social welfare system. Beleaguered manufacturing and industrial sectors are gaining influence and calling for protectionist trade policies. All these changes will greatly affect Sino-U.S.trade and economic relations. Obama does not want to be labeled a trade protectionist, but he has to do something to soothe domestic emotions.

The fourth variable is the changing international environment, especially the world financial crisis, economic recession and other rising global issues.

The Wall Street storm hit more than the financial field. It has damaged the real economy and global economic health. And it is far from over. The Obama administration will therefore put economic recovery at the top of its agenda. If China can help Obama in this endeavor, the new president will be happy to promote and push forward China-U.S. relations. Otherwise, their bilateral relationship will be challenged.

On global issues like climate change, energy and environmental protection, the Obama administration will try to maintain dominance. It will also have growing expectations for China in these areas.

Possible challenges

The top risk is Sino-U.S. trade and economic relations. Both countries face economic challenges. Obama will be busy bailing out the market, stimulating domestic employment and improving living standards. In the meantime, the Chinese Government will engage in solving problems like unemployment among recent college graduates and rural workers, revitalizing the economy, maintaining economic growth and increasing domestic demand. Concerns on both sides will inevitably jeopardize bilateral trade and limit the flexibility of their policies.

The Obama team has made a list for China. If it cannot be fulfilled, Obama's China policy will harden. The list demands that China continue to purchase U.S. national debt, increase investment in the International Monetary Fund and strengthen coordination on reforming the China-U.S. financial system. Based on its own economic and political interests, China can only satisfy some of these requirements, which will leave an unfavorable first impression on the Obama administration.

The Democratic Party represents American workers who have lost many jobs as corporations move their operations overseas. They must press Obama harder to protect their interests. China's labor standards will come under scrutiny after topics like currency devaluation, product safety, protection of intellectual property rights and further opening financial markets.

Diplomacy will be another area with potential for disagreement. The Obama administration will first focus on shifting troops from Iraq to Afghanistan, then consider repairing U.S. relations with Russia and the EU and continue negotiating with North Korea and Iran over nuclear issues. The United States hopes China will play a constructive role and be a responsible big country on these issues. How much Beijing can share these burdens with Washington will be a touchstone with which Obama tests the relationship. The U.S. Government can also use diplomatic issues to distract attention from the economy. Based on this, the Obama administration might increase its demands-for example, asking China to send troops or capital aid to Afghanistan-while continuing to pressure China on its relations with Myanmar and Sudan. Therefore, the diplomatic relationship between the two countries could become turbulent.

Human rights and ideological issues are still prominent, but now manifest themselves in a different way. Currently, these issues center on the soft power contest between China and the United States. Obama is trying to restore the U.S. image and its hegemonic position in the world to protect American values. The potential for conflict between the two countries will not lessen in these fields.

The author is Director of the Institute of American Studies, China Institutes of Contemporary Insternational Relations