Trump claims outreach by China on trade talks

US president Donald Trump today said China was willing to negotiate despite an escalation in the ongoing trade war, latching onto comments by a senior Chinese official.

"You probably read the breaking news a little while ago that they want to make a deal. They just came out, and they want 'calm.' And that is a great thing, frankly," Trump said on the sidelines of the G7 summit in Biarritz, France. Trump added that "China called, last night, our top trade people, and said, 'Let's get back to the table.'"

Chinese vice premier Liu He, speaking earlier today at a technology forum in Chongqing, China, said Beijing was well placed to withstand the pressure of tariffs the US plans to impose on the entirety of its imports from China. Beijing will not be carried away by emotions in its response, said Liu, who oversees trade negotiations with the US.

"The key words are 'calm,' 'consultation' and 'cooperation,'" Liu said. "But if someone continues to misunderstand China's rational calm, still imagining that it can exert extreme pressure and China will not counter it, then China has no other choice and will continue to resolutely fight against it."

The Chinese foreign ministry said it was not aware "of the phone calls over the weekend" mentioned by Trump, but added that "trade differences should be solved through dialogue and consultation."

Pressed to explain Trump's statement on US-China discussions, US treasury secretary Steven Mnuchin said that "there were discussions that went back and forth, let's leave it at that." Mnuchin said "the vice premier has come out with an important statement. We have been communicating through intermediaries."

"'Calm' is a good word to use. I do not use it often," Trump said. "That message is a good message, a positive message."

Trump on 23 August announced further increases in the rate of tariffs affecting $550bn/yr of imports from China.

Beijing earlier that day announced retaliatory tariffs against an additional $75bn/yr of imports from the US, for the first time including taxes on US crude oil. China's commerce ministry denounced the US move but did not immediately pledge to retaliate.

Trump, who had plans to tout the strength of the US economy at the G7 summit, ended up having to defend his decision to escalate the trade war with China despite clear impacts on economic growth in the US and globally.

Trump yesterday said he had "second thoughts" about the decision. But the White House later clarified he only regretted not raising the tariffs higher.

Trump appears to remain concerned about the trade war's fallout on US farmers, after customers in China cut back purchases of US agricultural products including soybean. Trump summoned reporters yesterday to his meeting with Japanese prime minister Shinzo Abe to announce the imminent conclusion of a US-Japan trade deal. The deal would sharply increases purchases of US agricultural products by Japan and will be signed next month, Trump said.

Abe said the deal was yet to be finalized. "We still have some remaining work that has to be done at the working level, namely finalizing the wording of the trade agreement and also finalizing the content of the agreement itself," Abe said.

That did not stop Trump from saying today: "We just did a trade deal with Japan and we are working on other bilateral trade deals."