International Monetary Fund nanaging director Christine Lagarde issued a fresh warning about the threat trade tensions pose for the world economy and said it may take time for the US and China to resolve their issues.
The comments came two days after tweets by US President Donald Trump warning of new tariffs on China, marking an escalation of hostilities amid talks aimed at brokering a solution between the two nations.
The US also accused China of backpedalling on commitments made during the negotiations, according to Bloomberg.
“We thought this threat was waning and relations were improving and we were moving toward an agreement,” Ms Lagarde said in Paris. “We hope that is still the case but today rumours, tweets and comments are not very favorable.”
Speaking later in Paris, Ms Lagarde said there may not be a quick resolution as both sides must tackle “very important issues.”
“All the observers would like it to be done yesterday, but those matters actually take time,” Ms Lagarde said.
China’s top trade negotiator, Liu He, still plans to visit the US this week for trade talks. Mr Trump has said he intends to raise tariffs on $200 billion of Chinese goods to 25 per cent from 10 per cent and may also impose duties “shortly” on $325bn of Chinese goods that aren’t currently covered.
“It is imperative for trade tensions to be resolved in a satisfactory way for everyone,” Mr Lagarde said.
“Today, clearly the tensions between the US and China are a threat for the global economy.”
Chinese Vice Premier Liu He will visit the United States this week for trade talks, Beijing said on Tuesday, playing down a sudden increase in tension.
China's Commerce Ministry confirmed that Mr Liu, who leads the talks for Beijing, will visit the United States on Thursday and Friday. The ministry did not elaborate or give the expected topics of discussion, acccording to Reuters.
Beijing's response to the prospect of new tariffs has been reserved, and on Tuesday, Foreign Ministry spokesman Geng Shuang told a news briefing that mutual respect was the basis for reaching a trade agreement.
"Adding tariffs can't resolve any problem," Mr Geng said.
"Talks are by their nature a process of discussion. It's normal for both sides to have differences. China won't shun problems and is sincere about continuing talks," he said.
"We hope the US side can work hard with China, to meet each other halfway, and on the basis of mutual respect and equality, resolve each other's reasonable concerns, and strive for a mutually beneficial, win-win agreement."
