US Commerce Secretary Wilbur Ross predicts Beijing and Washington could reach a trade deal that "we can live with" as officials from the world's two largest economies resume talks in a bid to end their trade dispute.
Ross told CNBC the immediate trade issues would be easiest to tackle while enforcement issues and structural reforms, such as intellectual property rights and market access, would be more challenging to resolve.
"I think there's a very good chance that we will get a reasonable settlement that China can live with, that we can live with and that addresses all of the key issues," Ross said in an interview with CNBC on Monday.
China's Foreign Ministry said Beijing had the "good faith" to work with the United States to resolve trade frictions as Chinese officials met their US counterparts in Beijing for the first face-to-face talks since President Donald Trump and President Xi Jinping agreed in December to a 90-day truce in a trade war that has roiled global markets.
Trump said on Sunday that trade talks with China were going very well and that weakness in the Chinese economy gave Beijing a reason to work towards a deal.
Ross told CNBC the talks were being held with appropriate-level staff and would help determine how the administration moves forward.
The two sides agreed to hold "positive and constructive" dialogue to resolve economic and trade disputes in accordance with the consensus reached by their respective leaders, Foreign Ministry spokesman Lu Kang told a regular news briefing.
"From the beginning we have believed that China-US trade friction is not a positive situation for either country or the world economy. China has the good faith, on the basis of mutual respect and equality, to resolve the bilateral trade frictions."
Trump imposed import tariffs on hundreds of billions of dollars of Chinese goods last year and has threatened more to pressure Beijing to change its practices on issues ranging from industrial subsidies to intellectual property to hacking. China has retaliated with tariffs of its own.
"As for whether the Chinese economy is good or not, I have already explained this. China's development has ample tenacity and huge potential," Lu said. "We have firm confidence in the strong long-term fundamentals of the Chinese economy."
Lu also said Vice President Wang Qishan would attend the annual World Economic Forum in Davos, Switzerland in late January, but added that he had not yet heard of any arrangements for a meeting with Trump there.
By Monday evening, few details had emerged of the trade talks, which were scheduled to run through Tuesday.
Although the talks were held at a vice ministerial level, Chinese Vice Premier Liu He, who has led trade negotiations with the US and is a top economic adviser to Xi, made an unexpected appearance at the meetings on Monday, according to a person familiar with the discussions.
The US delegation, led by Deputy US Trade Representative Jeffrey Gerrish, includes under secretaries from the US departments of agriculture, commerce, energy and treasury, as well as senior officials from the White House.
