Joe Biden Entering Xi Jinping Talks In 'Strong Position'—John Kirby

As President Joe Biden meets China's President Xi Jinping on Wednesday in San Francisco, he feels confident of the fact that the American economy is currently faring better than the Chinese one, National Security Council spokesperson John Kirby said on Tuesday.

The two leaders will hold talks in the Californian city in an effort to strengthen and stabilize the rocky relations between their two countries, one year after they first met as leaders at the G20 summit in Bali, Indonesia.

In an interview with Voice of America (VOA), Kirby said that Biden "believes that he's coming into this meeting from a strong position" as the American economy has proven incredibly resilient post-pandemic, whereas China is still facing the turmoil created by the downturn of its housing market bubble.

"The United States economy is stronger now than it's been in many, many decades," Kirby said. "And we have shored up and revitalized our alliances and partnerships throughout the Asia-Pacific and beyond."

The high-profile meeting is taking place amid heightened tensions in the relationship between the U.S. and China, as Beijing's aggressive behavior towards Taiwan worries Washington and economic competition between the two countries intensifies.

While geopolitical issues—as well as Russia's invasion of Ukraine and Israel's war on Hamas—are likely to overshadow the significance of the Biden-Xi meeting, the competition between the two countries is expected to take center stage in the talks.

On this front, Biden does technically have the upper hand, as the U.S. economy has proven strong in the past year—whereas the Chinese economy has been dealing with seismic changes at home.

The explosive growth that characterized the country in the past few decades has significantly slowed down since the pandemic, hitting a slump caused by a weaker yuan, a worsening property crisis, high youth unemployment, soaring local debt, and demographic pressure.

"There are a lot of things that are contributing to a much more pedestrian growth rate in the next 10 to 20 years. I call them the seven Ds," George Magnus, once chief economist of UBS and now an associate at the China Centre at the University of Oxford in the U.K., told Newsweek.

"The debt, in which the housing market obviously is included. Demographics, with the Chinese population rapidly aging. Dynamism, with which I mean that productivity isn't really firing any more because reform in this direction hasn't happened. Decoupling and de-risking, which is a bit constraint on China's ability to develop the new economy and technology. Directive, the government has become more controlling. And shortage of demand," he added.

While China was once rumored to be taking over the U.S. as the world's biggest economy, this idea is now out of the question, according to Magnus.

The U.S. economy, on the other hand, is relatively strong, with the real GDP having surpassed its pre-pandemic level already in the first quarter of 2021 and now being 6.1 percent higher than in the last quarter of 2019, according to the U.S. Department of the Treasury.

Inflation has also cooled down faster in the U.S. than in other advanced economies and the labor market has remained strong, defying fears of a looming recession at the end of 2022. In the third quarter, the U.S. economy continued to defy expectations by growing by 4.9 percent, a faster pace than expected.