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In a speech to the Republican committee, Trump said that if it had not been for the tariffs, the Chinese economy would have caught up with the U.S.

At a Republican fundraising dinner in Washington on Tuesday, Trump spoke about his relationship with Xi, pointing out that he likes to call the Chinese leader "king" and remembering how Xi reacted when he brought up this honorific.

Mr Trump said the U.S. and China had agreed on "a lot of the most hard points" but that "we have some ways to go".

Vice Premier Liu said great progress has been made because of Trump's involvement in the talks.

"He said, "But I am not king, I am president.' I said 'No, you're president for life, and therefore you're king", Trump told his audience, prompting laughter, CNN reported. "That doesn't mean a deal is made, because it's not, but we're certainly getting a lot closer", Trump said in the Oval Office.

Those structural issues along with the way a potential deal would be enforced have been sticking points during months of talks between the world's two largest economies. Mr. Trump suggested at the press conference that some of these persisted.

"So, I hope that we're moving along not only the general terms of the trade agreement but also a real focus on what I think is the single greatest threat long term, and that's having China more productively participate in the production of intellectual property".

Last July, Trump and European Commission President Jean-Claude Juncker announced they had agreed the terms of a future trade pact.

During the meeting, Liu said that in the past two days, the economic and trade teams of the two sides have conducted fruitful negotiations and reached new consensus on the text of China-U.S. economic and trade agreement.

He said there were still some major issues left in trade talks, according to media reports.

Trump has been accusing China of indulging in unfair trade practices, like the theft of USA technology and massive state intervention in markets, contributing to the huge trade deficit amounting to Dollars 375 billion.

Washington and Beijing since a year ago have slapped tariffs on more than $360 billion in 2-way trade, biting into their manufacturing sectors as the world economy shows signs of slowing. China's rubber stamp legislative chamber, the National People's Congress, in March approved a new foreign investment law that the government claims will ensure all companies registered in China are treated equally.

Image copyright Getty Images What's at stake?

One of the final issues is what will happen to the tariffs the two sides have imposed on about $360 billion of each other's goods in the past nine months.

The clock is ticking for the Trump administration because the Chinese are not far from thinking they might be able to run out the clock until the 2020 US election, bringing the game into a tense overtime period where every bit of bad economic news in the United States counts double or triple against the incumbent president.

The sides mainly disagree on the US stand to retain some tariffs as an enforcement tool, according to an official.

This is a breaking news update - we will have additional details as they become available.