US, China hold talks to resolve trade conflict

US and Chinese trade representatives held talks on resolving key issues in the ongoing trade conflict between the two countries, the China's Trade Ministry said on Tuesday.

"The two sides discussed the resolution of each other's core concerns, reached consensus on the resolution of relevant issues, and agreed to maintain communication on the remaining issues of the first phase of the agreement and consultation," a statement on the ministry's website said.

Chinese Vice Premier Liu He, leading the negotiations on the Chinese side, and US Trade Representative Robert Lighthizer, along with US Treasury Secretary Steven Mnuchin exchanged views in a telephone call early Tuesday, Efe news reported.

On the Chinese side, Commerce Minister Zhong Shan, People's Bank of China Governor Yi Gang, and vice president of the National Development and Reform Commission (the country's main economic planning body), Ning Jizhe, were also present.

China's commerce ministry said earlier this month that they had reached an agreement with Washington to phase out the duties that both sides had been imposing during the dispute, however US President Donald Trump lowered expectations days later.

Last week, Chinese President Xi Jinping said during an economic forum in Beijing that his country wanted to work on an agreement based on "mutual respect and equality," but that it was not China that started the conflict and it would retaliate if necessary.

The latest escalation in the trade war, which has resulted in successive tariff hikes from both countries for nearly two years, happened on September 1 with a 10-15 per cent increase in tariffs from Washington on Chinese imports worth $112 billion.

It remains to be seen whether on December 15 the same increase of up to 15 per cent will apply to all other US imports from China, the total value of which would reach $300 billion.

Impact of the trade tensions between the world's two largest economies has not been confined to the bilateral sphere and have had global ramifications.

The International Monetary Fund, in its latest global growth forecasts published in July, downgraded its projections to 3.2 per cent for the current year, 0.1 per cent less than in April, owing to global uncertainty caused by the trade dispute.