The Trump administration and China are close to finalising a modest trade agreement which would suspend tariffs that are set to kick in on Sunday.
“We’re close to a deal,” said Myron Brilliant, the US Chamber of Commerce’s head of international affairs.
Mr Brilliant said the administration has agreed to suspend Mr Trump’s plans to impose tariffs on 160 billion dollars in Chinese imports on Sunday and to reduce existing tariffs.
In return, Beijing would buy more US farm products, increase Americans companies’ access to the Chinese market and tighten protection for intellectual property rights.
The deal awaits final approval from President Donald Trump.
Mr Trump took to Twitter early on Thursday to declare: “Getting VERY close to a BIG DEAL with China. They want it, and so do we!”
Earlier on Thursday, a spokesman for China’s Ministry of Commerce, Gao Feng, told reporters that “the economic and trade teams of both sides have maintained close communication”.
Beijing had threatened to retaliate if Mr Trump proceeded with plans to raise tariffs on Sunday.
The two sides are negotiating a so-called Phase 1 agreement as part of the effort to resolve their sprawling trade dispute.
Still, the truce leaves unsettled the toughest and most complex issues that have divided the two sides.
The administration accuses Beijing of cheating in its drive to achieve global supremacy in such advanced technologies as driverless cars and artificial intelligence.
The administration alleges — and independent analysts generally agree — that China steals technology, forces foreign companies to hand over trade secrets, unfairly subsidises its own firms and throws up bureaucratic hurdles for foreign rivals.
Beijing rejects the accusations and contends that Washington is simply trying to suppress a rising competitor in international trade.
Since July 2018, the Trump administration has imposed import taxes on 360 billion dollars in Chinese products. Beijing has retaliated by taxing 120 billion dollars in US exports, including soybeans and other farm products that are vital to many of Mr Trump’s supporters in rural America.
On Sunday, the US is scheduled to start taxing another 160 billion dollars in Chinese imports, a move that would extend the sanctions to just about everything China ships to the United States.
Repeated rounds of negotiations had failed to achieve even a preliminary agreement. The prolonged uncertainty over Mr Trump’s trade policies has slowed US business investment and likely held back economic growth.
Many corporations have slowed or suspended investment plans until they know when, how or even whether the trade stand-off will end.
A far-reaching agreement on China’s technology policies will likely prove difficult. It would require Beijing to scale back its drive to become a global powerhouse in industrial high technology, something it sees as a path to prosperity and international influence.