"I am happy today that we are launching a permanent, independent, nonprofit organization focused not only on our goal of 100,000 American students in China by 2014, but on strengthening the students exchanges for years to come," said U.S. Secretary of States Hillary Clinton at the press conference.

Clinton noted that people-to-people exchanges will contribute to the "consequential relationship" between the United States and China, a relationship now with "the most pressing challenges and the most exciting opportunities."

With the government-to-government relations "obviously essential", she said people-to-people ties will "determine the quality of the relationship for the future."

The new foundation was borne out of the U.S. State Department's 100,000 Strong Initiative that was announced by President Barack Obama in 2009 and launched by Clinton in 2010.