China says US must avoid triggering trade tensions

China said Tuesday the United States, as the source of the global financial crisis, should avoid triggering trade tensions, but also signalled a willingness to avoid an all-out war with Washington.

The comments by China's commerce ministry came one day after Beijing lodged a complaint against new US tariffs on Chinese tyre imports at the World Trade Organization, charging the move was "protectionist."

"We know the economic crisis originally began in the US so it should take the corresponding responsibility and be careful about using trade protectionist measures," ministry spokesman Yao Jian told a press briefing.

Amid warnings that a jump in Chinese-made tyres had cost more than 5,000 jobs in the United States, President Barack Obama on Friday imposed punitive duties of 35 percent on the Chinese imports, invoking a WTO rule.

The step has ignited the first trade spat of his presidency just as he prepares to host his Chinese counterpart Hu Jintao at a G20 gathering next week in Pittsburgh.

While further criticising what he called the US "abuse" of WTO rules in imposing the tariffs, Yao signalled China might be willing to avoid an all-out trade war through negotiations.

"We do not like to see... anything that negatively impacts bilateral trade, including US abuse of such measures," he said.

"So when we meet with trade friction, we are willing to continue consultation and communication on relevant matters."

Yao complained that the impact on jobs would be more severe in China than in the United States.

"The impact of adopting such measures is even greater on Chinese industry because as everyone knows, China is a labour-intensive country," he said.

On Sunday, China's state-run media quoted experts saying that 100,000 Chinese jobs could be lost as a result of the US tariffs.

Obama warned Monday he would fight tenaciously for America's trade rights, after a row over US tariffs on Chinese tires threatened to sour the mood ahead of next week's G20 summit.

But the president dismissed fears of a trade war and aides rejected the idea that the spat, over US duties of 35 percent on Chinese tire imports, could harm wider diplomatic relations that both sides appear keen to improve.

Obama rejected arguments that his move amounted to blatant protectionism, during a key economic speech in New York.

"Make no mistake, this administration is committed to pursuing expanded trade and new trade agreements," Obama said at historic Federal Hall on Wall Street.

"It is absolutely essential to our economic future."

"But no trading system will work if we fail to enforce our trade agreements, those that have already been signed.

"So when, as happened this weekend, we invoke provisions of existing agreements, we do so not to be provocative or to promote self-defeating protectionism, we do so because enforcing trade agreements is part and parcel of maintaining an open and free trading system."

Later Monday, in an interview with Bloomberg Television, Obama insisted that the row would not escalate out of control.

"We're not going to see a trade war. I think that there are some tensions around this, no doubt about it. But my message is very simple: We have rules on the books."

The president meanwhile told CNBC that he was "not surprised" China was upset, but pointed out that Washington had a "huge economic relationship with China" and a "strong strategic relationship."