China lodged a "stern" diplomatic protest with the USA on Monday after its guided-missile destroyer sailed near disputed islands in the South China Sea, asserting that America should stop such "provocative" action and create an enabling environment for successful negotiations on the ongoing trade dispute.
The source confirmed to Reuters that the talks were "ongoing", but few other details had emerged.
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 toward a deal.
The discussions are the first face-to-face interactions between the US and China since both presidents met in Argentina and agreed to a temporary truce in their tit-for-tat tariff war.
United States commerce secretary Wilbur Ross predicted that the United States and Chinaare likely to reach a trade deal, as officials from both nations met for face-to-face talks in Beijingon Monday (New York time).
The meeting between the US delegation - led by Deputy US Trade Representative Jeffrey Gerrish and including officials from the Treasury, Commerce, Agriculture and Energy Departments - and the Chinese side ran late into Tuesday night.
Trump has imposed tariffs to pressure Beijing to change its practices on issues ranging from corporate espionage to market access and industrial subsidies.
Earlier on Tuesday, China approved five genetically modified (GM) crops for import, a move seen as a "goodwill gesture" by some in the USA agriculture industry that could boost China's overseas grains purchases and ease pressure from the United States to open its markets to more farm goods. The two sides have provided scant information about the discussions, and neither has indicated its stance has changed since a December 1 agreement by Presidents Donald Trump and Xi Jinping to postpone further increases.
USA and Chinese officials met Monday in the Commerce Ministry in Beijing to begin their two-day trade negotiations.
Additionally, the US and China will meet for a third day on Wednesday.
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He said the United States ship sailed through the area without the permission from the Chinese side.
International Brent crude futures had yet to trade.
Even so, Lu said, "China's development has ample tenacity and huge potential".
Liu's appearance at the talks is a "symbol of Xi's personal buy-in" in the effort to reach a deal, said Leland Miller, chief executive officer of China Beige Book, a data-analytics firm that surveys companies across the Chinese economy.
"On whether this operation will affect the ongoing trade talks between the two sides, I believe proper resolution of trade disputes is conducive to the world".
For their part, Chinese officials are unhappy with US curbs on exports of "dual use" technology with possible military applications. Beijing has retaliated in turn to United States tariffs.
The Trump administration's calculus regarding how much to stress either increased purchases of U.S. goods, on the one hand, or structural reforms reflects a divide within the White House.
USA officials worry that China's rise as a potential competitor in telecoms, solar power, electric cars and other fields might erode American industrial leadership. "We have lodged stern representations with the USA side".