Chinese President Xi Jinping spoke by phone with his American counterpart Joe Biden on the eve of the Lunar New Year celebration, kicking off the top-level exchange between Beijing and Washington three weeks into the new US administration.

The two presidents exchanged Chinese Lunar New Year greetings along with views on bilateral relations and major international and regional issues, according to a release from China's Foreign Ministry on Thursday.

Xi once again congratulated Biden on his inauguration as US president and wished the Chinese and American people a happy and auspicious Year of the Ox.

In the telephone call, Xi said that cooperation is the only correct choice for China and the United States, and confrontation between them is a disaster for both countries.

Xi also said the two countries should re-establish their various dialogue mechanisms so as to accurately understand each other's policy intentions and avoid misunderstanding and miscalculation.

Xi told Biden that the foreign affairs departments of the two countries can deepen communication on a broad range of issues in bilateral relations and on major regional and international affairs.

More contact also may be carried out between economic, financial and law enforcement agencies as well as the militaries of the two countries, Xi added.

The president said China and the US should respect each other and properly manage their disputes in a constructive manner.

He said China hopes the US respects China's core interests and cautiously deals with matters related to Taiwan, Hong Kong and Xinjiang, which are China's domestic issues concerning the nation's sovereignty and territorial integrity.

In the phone call, Xi mentioned that Biden once told him what defines the United States is the country's "possibilities", referring to their talks during Biden's trip to China a decade ago, when both were vice-presidents.

"When I was with Xi Jinping — and I was on the Tibetan plateau with him — and he asked me in a private dinner, he and I, and we each had an interpreter, he said, 'Can you define America for me?'" Biden recounted during a swearing-in ceremony for new staffers, hours after his inauguration.

Biden, who was then vice-president in the Obama administration, said he responded to Xi, who was then vice-president: "possibilities", CNN reported on Jan 22.

Xi said he hoped that those possibilities will now point toward an improvement of China-US relations.

A readout from the White House said Biden shared his greetings and well wishes with the Chinese people for Lunar New Year and affirmed his priorities of protecting the American people in various areas.

"The two leaders also exchanged views on countering the COVID-19 pandemic, and the shared challenges of global health security, climate change, and preventing weapons proliferation," the White House said.

The long-awaited phone conversation with Xi came days after Biden said, "there's no reason not to call him".