Smog in key north China region rises 27 pct in March - ministry

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China runs multibillion-dollar monthly surpluses with Europe and the USA, which helps to offset deficits with Japan, South Korea and developing countries that supply industrial components and raw materials.

The trade deficit came in at USD4.98 billion in March, in contrast to the expected surplus of USD27.5 billion.

New vehicle sales in China returned to growth in March, with deliveries to dealers rising by 4.7% to 2.66m units from 2.54m units a year earlier, according to data released by the China Association of Automobile Manufacturers (CAAM).

President Xi Jinping's vow this week to cut tariffs in some sectors, and Trump's warm response, have calmed some concerns - but a vast gulf in expectations remains between the two nations.

"We hope both China and the United States can solve the disputes with wisdom and respect, in a constructive way", Spokesman Huang said. His speech did not specifically mention the United States or its trade policies, which have been assailed by Chinese state media in recent days.

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Further to that strategy, it has been learned that The Trump Administration is working on a program, which could cost billions of dollars, to compensate farmers suffering from Chinese retaliatory tariffs on USA crops.

The live-fire drill, scheduled for 18 April, is both "a message to Taipei and a show of geopolitical support for Russian Federation during its time of friction with the United States", says The South China Morning Post.

The ruling Communist Party has given the go-ahead to a plan to turn the southern island province of Hainan into a free trade zone (FTZ) to facilitate further reform and opening up of the world's second largest economy.

Commerce Ministry spokesman Gao Feng told reporters during a regular briefing, however, that Xi's remarks had nothing to do with the trade row and should not be mischaracterized as a concession to Washington.

"When you're $500 billion down, you can't lose a trade war", he said.

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"Again, we're doing really well with China".

"We put a $50 billion tariff on, and then we put $100 billion tariff on".

So far the large threats wielded by both sides have not been implemented.

The US targeted steel and aluminium while China took aim at pork and wine among a slew of other products from the US.

Analysts expected China would record a trade surplus of US$27.21 billion for last month, from February's surplus of US$33.75 billion.

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In January and February 2017, trade between the two countries totalled €10.35 billion.

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