President Barack Obama and Chinese President Xi Jinping will test the limits of their personal ties Friday as they wade into issues that have exacerbated tensions between their nations: China's cyberspying in the U.S. and Beijing's territorial disputes in the Asian Pacific.

Discussions on both matters will play out against the backdrop of White House pageantry as Obama hosts Xi for a grand state visit, including a glitzy black-tie dinner. In keeping with the spirit of a state visit _ an honor bestowed on close partners _ the U.S. was emphasizing areas of agreement with Beijing, including on climate change.

U.S. officials said Obama and Xi would release a joint statement on climate change fleshing out how they plan to achieve targets for cutting carbon emissions set at a bilateral summit in Beijing last year. Xi also planned to announce a blueprint for a nationwide cap-and-trade system beginning in 2017, one that would cover highly-polluting sectors ranging from power generation to papermaking.

China will also offer a ``very substantial financial commitment'' to help poor nations transition to low-pollution technologies, the U.S. officials said, without releasing the exact figure.

Climate change is one of the few areas where bilateral cooperation has proceeded smoothly in recent months, largely because Beijing has struggled to contain heavy air, water and soil pollution that has destroyed farmland, sent cancer rates soaring and left its cities cloaked in dense smog.

The progress on China has been offset by disputes over cyberespionage and territorial disputes that have spooked U.S. partners in the region.

``The assumptions that many people had, that cooperation on transnational threats like climate change would ameliorate problems in geopolitical arenas were wrong,'' said Michael Green, White House Asian Affairs director under President George W. Bush and current senior vice president at the Center for Strategic and International Studies.

U.S. officials have had hope for broader cooperation between Obama and Xi since their unusually informal 2013 summit at the Sunnylands estate in southern California. Last year, Obama traveled to Beijing, and the two leaders strolled in the sprawling gardens next to the Forbidden City and met over a lengthy private dinner where details of the climate change agreement were finalized.

I think what's been distinct about their relationship, starting at Sunnylands, is far and away the most constructive engagements they've had have been in their private dinners,'' said Ben Rhodes, Obama's deputy national security adviser.

In recent weeks, however, U.S. officials have been taking a tougher line publicly against China's hacking, saying it is reaching epidemic levels. Officials have warned of retaliatory sanctions on businesses and individuals.

This is not just a matter of us being mildly upset, but is something that will put significant strains on a bilateral relationship if not resolved and that we are prepared to take some countervailing actions,'' Obama said this month.

Obama administration officials say China is getting the message. After National Security Adviser Susan Rice sharply warned Beijing about its actions during a visit to lay the groundwork for Xi's trip, China dispatched its top domestic security official to Washington to try to stave off sanctions ahead of the president's arrival.

China has denied being behind cyberspying in the U.S. and says it, too, is a victim of such espionage.

Lu Kong, a spokesman for the Chinese delegation, said that progress on high-level cyber dialogue were contingent on ``mutual benefit, mutual respect and equality.''

``Without that, I don't think there will be any cooperation,'' Lu said.

Obama and Xi are also expected to discuss China's disputed territorial claims, which have unnerved some U.S. partners in the Asia. The U.S. is particularly concerned about China's building of artificial islands with military facilities in the South China Sea.

Foreshadowing Obama's message to Xi on the matter, Rice said this week that, ``The United States of America will sail, fly, and operate anywhere that international law permits.''

Obama and Xi were expected to have discussed security issues during a private dinner Thursday night at the Blair House, a guest residence steps from the White House.

The state visit will formally begin Friday morning with an elaborate welcome ceremony on the White House South Lawn, two days after the event there for Pope Francis, though with a much smaller crowd. The leaders will then hold private talks in the Oval Office before taking questions in a joint Rose Garden news conference. (AP)