China, US reach 'agreements' on some eco, trade issues to avert trade war

China and the US have reached "agreements" on some of the issues but both sides were still "very divided" on several others during the economic and trade talks held here to end the tariff spat between the two major trading partners, according to a media report today.

The US delegation, led by Treasury Secretary Steven Mnuchin, who is also President Donald Trump's special envoy and Chinese side, led by Vice Premier Liu He, also a member of Politburo of the Communist Party of China Central Committee, met yesterday and today, and "agreed to set up a work mechanism to keep close communication".

A trade spat between the top two economies of the world began last month with Trump imposing tariffs on steel and aluminum imports into the US from China, which also retaliated by imposing additional tariffs worth about USD three billion on 128 US products.

The two countries have not yet implemented their tariff increases to reach a negotiated settlement.

"China and the US reached agreements on some issues in their economic and trade consultations in Beijing from Thursday to Friday," the state-run Xinhua news agency said in a brief report.

They have agreed to set up a work mechanism to keep close communication, it added.

The US goods and services trade with China totalled to an estimated USD 648.2 billion in 2016 in which China had a lion's share with about USD 478.9 billion exports. The US exports to China stood at USD 169.3 billion, according to US trade figures.

Hong Kong-based 'South China Morning Post' quoted an official statement as saying that both sides were still "very divided" on some issues and "more work needed to be done".

The two sides "reached some consensus" and exchanged views on expanding US exports to China, bilateral investment, intellectual property protection and the imposition of tariffs, the statement said, without elaborating.

In a separate statement, China's Ministry of Commerce said China also protested against a US ban on Chinese tech giant ZTE buying American components.

The US delegation said it would report back to President Donald Trump on the matter, according to the ministry.

The Post report quoted a draft framework of US demands which included China to cut the trade deficit by at least USD 200 billion by the end of 2020.

Washington also demanded Beijing halt subsidies for industries under the "Made in China 2025" plan, and that China should not resort to retaliatory measures against the US, it said.

The US delegation also include Commerce Secretary Wilbur Ross, US Trade Representative Robert Lighthizer, Assistant to the president for economic policy Larry Kudlow and Peter Navarro, Assistant to the president for trade and manufacturing policy.

The US, the world's largest economy, has a trade deficit of almost USD 500 billion with China, the world's second largest economy.