China, US Begin Two-day Talks On Trade Spat

US and Chinese negotiators kicked off two days of high-level trade talks in Beijing on Thursday hoping to resolve a festering dispute that has cast a shadow over financial markets and the global growth outlook.

Vice Premier Liu He and the chief American envoy, Trade Representative Robert Lighthizer, shook hands at the start of the meeting at a government guesthouse but said nothing to reporters.

Pressure to seal an accord ahead of a March 1 deadline set by Donald Trump appears to have eased slightly after the US president indicated he was open to extending a trade truce depending on progress in Beijing.

Trump in December postponed plans to sharply hike tariffs on US$200 billion of Chinese imports to allow more time for negotiation.

We are "looking forward to discussions today," Treasury Secretary Steven Mnuchin had said as he left his hotel on Thursday morning for the talks.

Expectations for a trade deal have grown as China faces pressure from slowing economic growth, and as swooning global markets rattle Trump and his economic advisers.

President Xi Jinping plans to meet with the US officials in Beijing this week, a report in the South China Morning Post said on Wednesday, bolstering hopes for the talks and markets in Asia.

Trump also has said he expects to meet with Xi "at some point" to clinch a trade deal.

Trump told reporters in the Oval Office overnight on Wednesday that preliminary talks in Beijing were "going along very well," Bloomberg reported.

"They're showing us tremendous respect," he added.

"Markets will continue to watch – and react – closely to the ups and downs of the negotiations," said Trey McArver of Trivium Research.

"But Sino-US relations are all about the two leaders, and it will ultimately be up to Xi and Trump to come to a deal – or not," he wrote on Wednesday in a newsletter. (AFP, AP)