The United States and China are negotiating behind the scenes to ease trade tensions, the head of the OECD said Friday, stressing that "nobody wins" in a high-level trade war.

Angel Gurria said Chinese officials had told him this week that they were talking to their US counterparts, despite official denials.

"Everybody is very alarmed by these announcements (of tariffs), but at the same time, they are talking… there seems to be a series of conversations going on," added Gurria, who heads the Organisation for Economic Cooperation and Development.

On Thursday, China's Commerce Ministry spokesman Gao Feng told reporters that "up to now China and the US have not carried out negotiation at any level on the trade frictions".

China has warned it will hit back at any US protectionist moves after President Donald Trump last week threatened fresh levies on billions of dollars of Chinese goods.

"There has not yet been a single increase in tariffs adopted by either side," noted Gurria.

"Nobody wins in a war when the largest economies in the world are involved," added the former Mexican finance minister.

He also warned there would be "negative spillover effects" from any trade war between the US and China. "It's not just them" that would be hit, he cautioned.

The threat of the trade war comes as the global economy has finally reached the level of growth — four percent — achieved before the debt crisis sparked by the collapse of US investment bank Lehman Brothers in 2008, noted Gurria.

"It took 10 years to get back to the level of growth in the world economy from before the crisis. This is the size of the crisis. This is the impact of the crisis. This is how broad and deep the crisis was," said Gurria.

"But right now, we are back where we were before the crisis in 2008."

China says Xi pledges unrelated to US trade spat
Beijing (AFP) April 12, 2018 –

China denied President Xi Jinping's pledge to further open the country's economy amounts to concessions in a trade spat with the United States, and warned it was ready to hit back at any new US protectionist moves.

Xi on Tuesday vowed to ease tariffs and open the economy up more in what was seen as a conciliatory gesture to temper fears of a US trade war after Donald Trump last week threatened fresh levies on billions of dollars of Chinese goods.

The US president welcomed the speech and said he saw an end to the dispute, which has roiled markets since the start of March.

But Commerce Ministry spokesman Gao Feng warned Beijing was ready to strike back if the United States presses on with its nationalist economic agenda.

"If the US side takes its own course and insists on carrying out unilateralism and trade protectionism, the Chinese side will fight resolutely and take them on until the end," Gao told reporters at a regular news briefing.

World markets rallied after Xi pledged at an economic forum to lower car tariffs, protect intellectual property and take other steps to open China's economy "wider and wider".

"China took the initiative to open up and made it possible for all countries across the world to ride on the express of China's economic development," Gao said.

But, he added, it "has nothing to do with China's trade friction with the US" and "we hope some people in the US don't misjudge the situation".

Gao once again struck down market hopes that the world's two largest economies have been negotiating on trade issues.

"Up to now China and the US have not carried out negotiation at any level on the trade frictions," he said, blaming the US for not showing "sincerity" in its actions.

"China will not carry out negotiations under unilateral coercion," Gao told the press briefing.

Chinese firms holding off on US investment in Trump era
New York (AFP) April 12, 2018 –

Some Chinese companies are holding off on US investment plans while they see how the trade dispute with President Donald Trump plays out, executives said Thursday.

China Construction America acknowledged pausing some new US investment amid trade war fears.

But that uncertainty could mean more deals for some companies already in the US as competitors stay away, according to auto parts supplier Wanxiang America.

US-China trade tensions have escalated in recent weeks and threatened to boil over into a trade war after Washington and Beijing exchanged threats to impose steep import tariffs on each other.

The US is targeting what it says is the massive theft of American intellectual property, as well as restrictions on US goods entering the Chinese market, creating a large US trade deficit.

The sides recently seemed to indicate talks were possible, but the uncertainty remains.

"We have a big pipeline to acquire more US companies … but right now, we will watch a little bit," Yuan Ning, president of China Construction America, said at a US-China business summit.

The reticence stems from seeing other Chinese companies blocked from making acquisitions by the Committee on Foreign Investment in the United States (CFIUS), Yuan said. China Construction has been active in the US market for 33 years.

But Ni Pin, president of Wanxiang America, expects fewer new entrants from China and therefore less competition for deals.

"This probably will present a lot more opportunity," Ni predicted.

Equity markets greeted the more conciliatory tone earlier this week from Chinese President Xi Jinping, but analysts say the disagreements are real and will likely be difficult to resolve.

Chinese direct investment in the US fell to $29 billion in 2017 from $46 billion due to tightening spending by Beijing and obstacles set by CFIUS, according to Rhodium Group.