China is "pouring money" into its economy to minimise the adverse impact of the massive American tariffs, US President Donald Trump has claimed, days after the world's two largest economies agreed to re-launch the stalled negotiations to end the bruising trade war.
President Trump and his Chinese counterpart Xi Jinping, during a bilateral meeting at the G-20 Summit in Osaka, Japan, decided to hold off on imposing new tariffs on imports of each other's goods and move forward with a new round of trade negotiations.
Asserting that his policy of imposing massive tariffs on the import of Chinese products is working, Trump on Monday told reporters that the Chinese government has taken a series of steps to reduce its adverse impact.
"Our people aren't paying for those tariffs... China is paying for them, and those companies are paying for them," he said.
"China devalued their currency very substantially, and they also put a lot of money into their economy. They're pouring money. It's fake money, but it's money. And they're pouring money into their economy to take care of the tariffs," the US President said.
The American treasury is taking in billions and billions of dollars of money that normally would be for China, he said, adding that the officials of the two countries have already resumed their trade talks over phone.
"So we'll see what happens. We hope that we can make a deal, but it's got to be a fair deal. We had a deal, as far as I was concerned. And then, at the last moment, China decided they didn't like that deal and they changed it. It's all right. Then I said, 'You're going to pay 25 per cent tariffs on USD 250 billion," he said.
Trump said that he would be happy with any result of the trade talks.
"I'd expect him (Xi) to move. If he doesn't move, that's okay too. I'm very happy either way. But I think we have a good chance of making a deal. I think they want to make a deal.
"Because they're losing many companies that are leaving because of the tariffs, because they don't want to pay the tariffs. So, they're losing many companies. They're moving to Vietnam. And, by the way, some are moving back to the United States, where they belong," Trump claimed.
The US President warned that he will not agree to a trade deal with China unless it is a great one.
"If we don't make a great deal, a fair deal -- it has to be better for us than for them because they had such a big advantage for so many years. In other words, you can't make a 50/50 deal when somebody else has been absolutely -- I've been talking about this for years," he said.
China, he alleged, has always had a trade surplus.
"We can't make a 50/50 deal. It has to be a deal that is somewhat tilted to our advantage. If we're not going to do that, we're taking in a fortune from tariffs. And unfortunately we're hurting China by doing that because many of their companies are leaving and going to a non-tariff state, so they don't have to pay the tariffs," Trump added.
The US and China - the world's two largest economies - have been fighting a damaging trade war over the past year.
Trump is asking China to reduce massive trade deficit which last year climbed to over USD 539 billion. He has also asked China to workout verifiable measures for the protection of intellectual property rights, technology transfer and more access to American goods in the Chinese markets.
Trump has already slapped a 25 per cent tariff on USD 250 billion worth of Chinese goods and threatened to impose more.