China, U.S. discuss next stage of trade talks

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In a brief statement, the Chinese commerce ministry said Liu had spoken with Mnuchin and Lighthizer on a pre-arranged telephone call. "It looks like we're back in business now", the first USA trader said.

Trump has imposed import taxes on $250 billion in Chinese products - 25 percent on $50 billion worth and 10 percent on the other $200 billion.

Chinese auto dealers also perked up their shares, hoping that the temporary US-China treaty will help improve the domestic market.

USA exports of cars and light trucks to China were worth $9.5 billion in 2017 and have dropped off significantly since China imposed its retaliatory tariffs over the summer that gave exporters in Europe and Japan a significant advantage.

The White House announcement framed a victory for Trump and his unflinching negotiating tactics, securing a commitment from China to engage in talks on key U.S. economic priorities, with little obvious concession by the U.S. Notably, however, the White House appears to be reversing course on its previous threats to tie trade discussions to security concerns, like China's attempted territorial expansion in the South China Sea.

China has reportedly proposed cutting tariffs on US-made cars to 15%, the same tax levied on auto imports from other countries. Canada arrested Meng on December 1 at the Vancouver airport at the request of the USA, causing a major disruption in relations between the two North American neighbours and China.

"Now we are seeing the possibility that China will come through with reductions of tariffs on United States autos and that's another good, concrete step".

The trader said China was seeking to buy a total of 2.5 million to 3 million tonnes of USA soybeans.

American soybean farmers are still waiting to see the benefit of President Donald Trump's trade truce with China.

The two sides are expected to negotiate over USA demands for stronger Chinese protections for US intellectual property, an end to forced technology transfers and greater market access to China for USA companies.

Last July, Beijing raised tariffs of up to 40 percent on imported cars, forcing carmakers to increase the prices on vehicles sent to China for the year. "However this approach is making China think twice about their hard stance", said Ernesto Ramos, Managing Director of Active equities for BMO Global Asset Management in Chicago. Following a summit on trade in Buenos Aires earlier this month, Mr Trump jolted global auto stocks with a tweet that China agreed to "reduce and remove" tariffs on imported American-made cars, something China did not confirm at the time.

China promised to purchase USA soybeans as part of the preliminary deal forged by President Donald Trump and Chinese President Xi Jinping.

The US has a long list of complaints against China on intellectual property, forced technology transfers and industrial subsidies.

Also, Trump said he would intervene in a case against a top executive at Huawei Technologies if it would help secure a trade deal. In its latest guidance reported by state media on Wednesday, references to "Made in China 2025" were omitted.

China reportedly bought more than 500,000 tons of United States soybeans, worth around $US180 million.