There is a "good possibility" President Donald Trump will reach an agreement later this week to resolve the trade dispute with China, a White House official said Tuesday.

As the trade tensions have escalated and engulfed hundreds of billions of products in retaliatory tariffs, Trump is due to meet Chinese leader Xi Jinping in Buenos Aires later this week on the sidelines of the Group of 20 summit.

"There's a good possibility we can make a deal and he's open to it but certain conditions have to be met, certain things have to be changed," White House economic advisor Larry Kudlow told reporters.

Kudlow said any agreement must resolve the issues of "fairness and reciprocity" at the heart of the dispute.

Trump has imposed steep punitive tariffs on about half of the Chinese goods imported into the US market each year, and has threatened to target the remaining $267 billion in goods as well -- which would hit Apple iPhones and laptops produced in China.

Trump on Monday said he did not think a deal would be reached this week that would prevent a scheduled increase in the tariff rate on $200 billion in goods.

- China in a 'slump' -

But Kudlow's comments indicate Trump is more upbeat about the prospects. In addition, he said other countries share the US concerns over China's trade practices.

"China should change its practices and come into the community of responsible trading nations," Kudlow said.

He stressed that resolving the trade dispute requires that "certain conditions have to be met with respect to fairness and reciprocity... intellectual property theft must be solved, forced technology transfers must be solved."

The rising trade tensions have been flagged by economists and the International Monetary Fund, among others, as a potential risk to the global economy. And fears about the impact were a key factor behind the drop in US stocks in the past few weeks, which erased most or all of the gains in 2018.

But US growth remains on pace for a little over three percent this year, and Kudlow noted that the US economy is in a strong position, while China is slowing and is in "a slump."

Asked about the impact of tariffs on the economy, Kudlow said, "we are in a position to deal with it and handle it very well."

And there will be "enormous benefits" from free trade, he said.

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Trump says China tariff rates very likely to rise: report
Washington (AFP) Nov 26, 2018
US President Donald Trump said Monday he expected to raise the punitive tariff rates on hundreds of billions in Chinese imports as scheduled next year. Just days ahead of a planned meeting with Chinese President Xi Jinping, Trump also vowed to put tariffs on all remaining imports from China if the two sides failed to reach a deal, according to The Wall Street Journal. Trump already has imposed tariffs on more than $250 billion in Chinese goods - about half of the total imported each year - in ... read more