Chinese envoy says U.S. trade talks haven't broken down despite Trump tariffs hike

President Donald Trump issued a statement Friday saying the stiff tariffs his administration imposed "may or may not be removed" while trade talks continue.

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By Associated Press

BEIJING — China's leading envoy to trade talks in Washington says the failure to strike a deal in the tariffs war with the U.S. was "just a small setback" and negotiations will continue despite increases in import duties on American imports from China.

In comments to reporters before he left Washington for Beijing on Friday, Vice Premier Liu He said he was cautiously optimistic but that a deal would require the Trump administration to agree to end the punitive tariffs it has imposed on billions of dollars' worth of Chinese goods.

In comments carried by China's state-run CCTV, Liu said the remaining differences are crucial ones having to do with principles, "and we will make no concessions on matters of principle."

Still, he said he did not believe the negotiations had broken down.

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"On the contrary, I think it is just a small setback in the talks between two countries, which is inevitable," Hong Kong's Phoenix TV showed him as saying.

However, Treasury Secretary Steven Mnuchin told CNBC that there are currently no China trade talks scheduled in the future. "Nothing planned as of now," he said, adding that the talks held this week were "constructive."

The Trump administration raised tariffs on billions of dollars of Chinese goods to 25 percent from 10 percent on Friday. U.S. Trade Representative Robert Lighthizer said the U.S. was preparing to expand those tariffs to cover $300 billion of Chinese products that aren't already facing import taxes, or virtually everything imported from China.

President Donald Trump issued a statement Friday saying the stiff tariffs his administration imposed "may or may not be removed" while trade talks continue.

Liu said it was "China's opinion that the tariffs are the starting point of the trade friction and must be totally lifted if a deal is reached."

He also said the two sides were disagreeing over the amount of goods China would pledge to purchase from the U.S. to help reduce the American trade deficit.

"We think this is a very serious issue and we cannot easily change our minds," he said.

Liu sought to downplay the scale and impact of the dispute, saying that China was a strong nation and would surmount any problems caused by the conflict.

"We just had differences on the wording in certain documents and we hoped to solve the differences," he said. "Therefore, we think it unnecessary to make an overreaction to it."

Christina Wilkie, CNBC contributed.