Trump and China’s Xi Jinping agree to ‘strengthen economic exchanges’ amid trade war tensions

US president hopes to reach trade agreement at G20 meeting, report says

China’s president had an “extremely positive” phone call with Donald Trump in which the two leaders agreed to “strengthen economic exchanges”, the country’s foreign ministry has said.

The US president had said earlier on Twitter that he and Xi Jinping had a “very good” conversation.

“I agree, this phone conversation was an extremely positive phone conversation,” said a ministry spokesman, Lu Kang.

Mr Trump said he and President Xi plan to meet during a gathering of the G20 in Argentina this month and added trade discussions with China were “moving along nicely”.

“Both leaders attach great importance to China-US ties and economic ties,” Mr Lu said. “President Xi Jinping also stressed that China-US trade has long been serving as ballast and a stabiliser for China-US relations.”

The two leaders agreed the trade dispute “should be handled properly through substantial consultation,” Mr Lu added.

It comes amid a trade war between the two nations, which have imposed tariffs on hundreds of billions of dollars on each other’s goods. Mr Trump has threatened to put tariffs on the remainder of China’s $500bn-plus (£383.8bn) exports to the United States if the disputes cannot be resolved.

Bloomberg, citing people familiar with the matter, later reported Mr Trump wants to reach a trade agreement with China at the G20 meeting and that after the call with President Xi, he had asked officials to begin drafting possible terms.

The news agency said it was not clear if Mr Trump was easing up on demands China has resisted, and it cited one person as saying intellectual property theft was a sticking point on a possible deal.

In comments in state media, President Xi said he hoped China and the US would be able to promote a steady and healthy relationship, and that he was willing to meet Mr Trump in Argentina.

“The two countries’ trade teams should strengthen contact and conduct consultations on issues of concern to both sides, and promote a plan that both can accept to reach a consensus on the China-US trade issue,” President Xi said on CCTV state television.

Earlier this week, Mr Trump said he thought there would be “a great deal” with China on trade, but warned he had billions of dollars worth of new tariffs ready to go if a deal did not materialise.

The US has imposed tariffs on $250bn (£191.7bn) worth of Chinese goods, with duties on $200bn (£153.4bn) of the total set to increase to 25 per cent from 10 per cent on 1 January, 2019.

China has responded with retaliatory duties on $110bn (£84.4m) worth of US goods.

Additional reporting by agencies