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UPDATE 6-China accuses U.S. of creating 'imaginary enemy' during high-level talks

(Adds comments from U.S. officials, State Department)

By Yew Lun Tian and Tony Munroe

BEIJING, July 26 (Reuters) - A top Chinese diplomat took a confrontational tone on Monday in rare high-level talks with the United States, accusing it of creating an "imaginary enemy" to divert attention from domestic problems and suppress China.

Amid worsening relations between the world's two largest economies, Deputy Secretary of State Wendy Sherman, the second-ranking U.S. diplomat, arrived on Sunday for face-to-face meetings in the northern city of Tianjin that the State Department described as "frank and open".

There were no specific outcomes agreed and the prospect of a meeting between U.S. President Joe Biden and Chinese President Xi Jinping was not discussed, senior U.S. administration officials said following talks that lasted about four hours.

Shortly after Monday's meetings began, Chinese state media reported on confrontational remarks by Vice Foreign Minister Xie Feng, in echoes of a similarly combative opening by senior Chinese officials during high-level talks in March in Alaska.

"The United States wants to reignite the sense of national purpose by establishing China as an 'imaginary enemy'," Xie was quoted as saying as talks were underway.

The United States had mobilised its government and society to suppress China, he added.

"As if once China's development is suppressed, U.S. domestic and external problems will be resolved, and America will be great again, and America's hegemony can be continued."

Sherman laid out U.S. concerns over China's actions on issues ranging from Hong Kong and Xinjiang to Tibet and cyber attacks, senior administration officials said, adding that China should not approach areas of global concern, such as climate and Afghanistan, on a transactional basis.

Sherman, who also met with State Councillor and Foreign Minister Wang Yi, raised concerns including over what Washington sees as China's unwillingness to cooperate with the World Health Organization on a second phase investigation of the origins of COVID-19, and foreign media access in China.

"The Deputy Secretary raised concerns in private – as we have in public – about a range of PRC actions that run counter to our values and interests and those of our allies and partners, and that undermine the international rules-based order," the State Department said in a statement.

"It is important for the United States and China to discuss areas where we disagree so that we understand one another's position, and so that we are clear about where each side is coming from," a senior administration official said.