China's President Xi Jinping, right, greets US President Donald Trump before a bilateral meeting on the sidelines of the G20 Summit in Osaka on June 29, 2019. Photo: AFP / Brendan Smialowski

US President Donald Trump said trade negotiations with China were “back on track” after “excellent” talks on Saturday with his Chinese counterpart Xi Jinping with Washington reportedly agreeing to hold off on new tariffs.

The crunch talks on the damaging trade war between the world’s top two economies came on the sidelines of a meeting of the G20 in Osaka in Japan, with all eyes on whether the pair would call a truce.

“We had a very good meeting with President Xi of China,” Trump said after the talks. “I would say excellent.”

“We are right back on track,” he added without confirming any details of any agreement.

Both sides are expected to issue official formal statements later, but Chinese state media said Washington had committed not to impose any new tariffs on Beijing’s exports and that the two sides had agreed to restart trade and economic talks.

The outcome was likely to be seen as a win, with experts cautioning ahead of the meeting that a full agreement was unlikely, but a truce that avoided a new tit-for-tat round of tariffs would be positive.

“We won’t be adding an additional tremendous amount of $350 billion dollars left which could be taxed or could be tariffed,” Trump said at a press conference. “We’re not doing that, we are going to work with China on where we left off to see if we can make a deal. We will be continuing to negotiate.”

Trump has struck a conciliatory tone since his arrival in Japan for the G20 summit, despite saying China’s economy was going “down the tubes” before he set out for Osaka, and appeared keen to reach an agreement.

He said he was ready for a “historic” deal with China as the leaders kicked off their meeting and Xi told him that “dialogue” was better than confrontation.

All states back climate fight except US

Meanwhile, 19 members of the G20 – all bar the United States – agreed on Saturday to the “irreversibility” of the Paris climate deal and pledged its full implementation, after two days of talks.

The language in the final statement after the summit in Japan’s Osaka mirrored that agreed during last year’s G20, but was hard-won after objections from the US.

French President Emmanuel Macron said that international leaders should go “much further” on climate change after tough negotiations to agree on language on the issue at the G20 summit.

“We avoided going backwards… but we must go much further,” Macron said after 19 members signed a statement endorsing the Paris climate change agreement.

On the trade dispute, there were no immediate details about the leaders’ discussions, including whether they raised the thorny subject of Chinese telecoms firm Huawei. Washington has banned the company over security concerns and China reportedly wanted the restrictions lifted under the terms of any trade truce.

Xinhua wrote: “At the beginning of their meeting, Xi said that despite the great changes that have taken place in the international situation and China-US relations during the past 40 years, “one basic fact remains unchanged: China and the United States both benefit from cooperation and lose in confrontation.”

“Cooperation and dialogue are better than friction and confrontation,” Xi told Trump.

The first tete-a-tete between the leaders of the world’s top two economies since the last G20 in December cast a long shadow over this year’s gathering in Osaka, where differences over climate change were also laid bare.

Economists say that a lengthy trade war could be crippling for the global economy at a time when headwinds including increased geopolitical tensions and Brexit are blowing hard.

Japan’s Prime Minister Shinzo Abe, Ivanka Trump, President Trump and Indonesian President Joko Widodo attend an event on women’s empowerment during the G20 Summit on June 29, 2019. Photo: Brendan Smialowski / AFP

On Friday, the European Union and the South American trade bloc Mercosur sealed a blockbuster trade deal after 20 years of talks, with European Commission President Jean-Claude Juncker hailing it as a “strong message” in support of “rules-based trade.”

Trade has proved far from the only contentious issue on the table, with climate change being another major sticking point.

A diplomatic source said it had been a “difficult” night, with an American negotiator pushing a “very tough position” and a group including France standing united against watering down the climate language in the final statement.

But an agreement was reached there too, with German Chancellor Angela Merkel telling reporters that the final communique would preserve language used at the two past G20 summits. “We will have a similar text to Argentina. A 19+1 declaration,” she said.

The so-called 19+1 formulation reiterated the commitment of all G20 members except the United States to the Paris climate deal, from which Washington plans to withdraw.

German Chancellor Angela Merkel, left, and Russian President Vladimir Putin attend a meeting on the sidelines of the summit in Osaka on June 29, 2019. Photo: Alexander Zemlianichenko / AFP

Trump-Kim meet?

Trump has dominated the headlines from the summit, and once again caught observers by surprise by tweeting early on Saturday that he was open to meeting North Korea’s Kim Jong Un while in South Korea this weekend.

“If Chairman Kim of North Korea sees this, I would meet him at the Border/DMZ just to shake his hand and say Hello(?)!,” he wrote.

Several experts, however, said the focus on Trump and the talks with China struck at the heart of the G20 format, created to craft a united global response to the Lehman Brothers crisis.

“With much of the fate of the global economy and the likely direction of markets hanging on the outcome of this pivotal Trump-Xi meeting, we think things will get worse before they get better,” said ING Economics.

And the focus on bilateral meetings on the sidelines of the summit once again sparked doubts about the future of the gathering, experts said.

“The G20 was created as a forum for cooperation and the question may well be ‘have we reached the point where it can no longer serve that purpose’,” Thomas Bernes from the Centre for International Governance Innovation told AFP.

Agence France-Presse

Also read: Trump invites Kim to DMZ meeting 

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