BUENOS AIRES (REUTERS) - China and the United States have agreed to halt new tariffs as both nations engage in trade talks with the goal of reaching an agreement within 90 days, the White House said on Saturday (Dec 1) after US President Donald Trump and Chinese President Xi Jinping held high-stakes talks in Argentina.

Mr Trump agreed not to boost tariffs on US$200 billion (S$274 billion) of Chinese goods to 25 per cent on Jan 1 as previously announced, as China agreed to buy an unspecified but "very substantial" amount of agricultural, energy, industrial and other products, the White House said.

The White House also said China "is open to approving the previously unapproved Qualcomm Inc NXP deal should it again be presented".

The White House said that if agreement on trade issues including technology transfer, intellectual property, non-tariff barriers, cyber theft and agriculture have not been reached with China in 90 days, both parties agree that the 10 per cent tariffs will be raised to 25 per cent.

Mr Trump and Mr Xi sat down with their aides for a working dinner at the conclusion of a two-day gathering of world leaders in Buenos Aires.

"This was an amazing and productive meeting with unlimited possibilities for both the United States and China. It is my great honour to be working with President Xi," a White House statement quoted Mr Trump as saying after the 2½ hour meeting.

Chinese government's top diplomat, State Councillor Wang Yi, described the discussion over trade as "positive and constructive".

He told reporters in Buenos Aires that the two sides believed the agreement "effectively prevented the expansion of economic frictions between the two countries". "Facts show that joint interests between China and the United States are greater than the disputes, and the need for cooperation is greater than frictions," he said.

Beijing's goal was to persuade Mr Trump to abandon plans to hike tariffs on US$200 billion of Chinese goods to 25 per cent in January, from 10 per cent at present. Mr Trump has threatened to go ahead with that and possibly add tariffs on US$267 billion of imports if there is no progress in the talks.

'NOT A BREAKTHROUGH'

"I think this is not a breakthrough - it's more of avoiding a breakdown. This is not a worst case outcome but the hard work is ahead of them," said Paul Haenle, Director at the Carnegie-Tsinghua Center in Beijing. "The Chinese have to come into (the talks) with a sense of urgency," he added.

Scott Kennedy, a China expert at the Center for Strategic and International Studies in Washington, said the United States appeared to come out slightly ahead in the overall agreement.

"Beijing at best gets a temporary reprieve from additional tariffs, but was unable to get the US to agree to return to'business as usual'," he said. "Instead, only the pace of deterioration has changed, not the direction of the relationship," Kennedy added.

The closely watched encounter came shortly after the Group of 20 industrialised nations on Saturday backed an overhaul of the global body that regulates international trade disputes, marking a victory for Mr Trump, a sharp critic of the organisation.

Mr Trump told Mr Xi at the start of their meeting that he hoped they would achieve "something great" on trade for both countries.

He struck a positive note as he sat across from Mr Xi, despite the US President's earlier threats to impose new tariffs on Chinese imports as early as the start of next year.

He suggested that the "incredible relationship" he and Mr Xi had established would be "the very primary reason" they could make progress on trade, though he offered no sense of how they might resolve the main issue dividing their countries.

Mr Xi told Mr Trump that only through cooperation could the US and China serve the interest of peace and prosperity. Washington and Beijing have also increasingly been at odds over security in the Asia-Pacific region.

At the same time, Mr Trump again raised with Mr Xi his concern about the synthetic opioid fentanyl being sent from China to the US, urging the Chinese leader to place it in a "restricted category" of drugs that would criminalise it.

The White House statement said the Chinese leader agreed. "President Xi, in a wonderful humanitarian gesture, has agreed to designate fentanyl as a Controlled Substance, meaning that people selling fentanyl to the United States will be subject to China's maximum penalty under the law," the statement said.

The talks between both men were widely seen as the most important meeting of US and Chinese leaders in years.

The 90-day talks deadline falls just days before China's annual meeting of parliament in the first week of March, a politically sensitive time for Beijing.

Sun Zhe, co-director of the China Initiative at Columbia University, said China might have made greater concessions this time but may be looking for more out of the United States in the coming months.

"I think China compromised more. They bet that the United States would appreciate that China doesn't want to break the relationship even though China was pushed very hard," he said. "Some Chinese speculate about what compromise the United State can make in the future because China promised a lot and Trump just promised to not raise US tariffs," he added.

WTO REFORMS

Earlier on Saturday, the leaders of the world's top economies called for World Trade Organisation (WTO) reform in their final summit statement. Officials expressed relief that agreement on the communique was reached after negotiators worked through the night to overcome differences over language on climate change.

The final text recognized trade as an important engine of global growth but made only a passing reference to "the current trade issues" after the U.S. delegation won a battle to keep any mention of protectionism out of the statement.

Trump has long railed against China's trade surplus with the United States, and Washington accuses Beijing of not playing fairly on trade. China calls the United States protectionist and has resisted what it views as attempts to intimidate it.

The two countries are also at odds over China's extensive claims in the South China Sea and U.S. warship movements through the highly sensitive Taiwan Strait.

In addition to tariffs on Chinese goods, Trump has imposed tariffs on steel and aluminum imports into the United States this year. Numerous countries have filed litigation at the WTO to contest the levies.

The United States is unhappy with what it says is the WTO's failure to hold China to account for not opening up its economy as envisioned when China joined the body in 2001. The European Union is also pushing for sweeping changes to how the WTO operates.

G-20 delegates said negotiations on the summit statement proceeded more smoothly than at a meeting of Asia-Pacific leaders two weeks ago, where disagreement on protectionism and unfair trading practices prevented a consensus. European officials said a reference to refugees and migration - a sensitive issue for Trump's administration - was excised to ensure consensus.

On climate change, the United States once again marked its differences with the rest of the G20 by reiterating in the statement its decision to withdraw from the Paris Agreement and its commitment to using all kinds of energy sources. The other members of the group reaffirmed their commitment to implement the Paris deal and tackle climate change.

International Monetary Fund (IMF) Managing Director Christine Lagarde said high levels of debt accumulated by emerging market nations was a pressing concern.

US officials said a call by G-20 leaders for the IMF and World Bank to improve monitoring debt levels was aimed at ensuring that developing economies did not become to heavily indebted to China in return for infrastructure projects.

US officials have warned about China's increasing influence across swaths of the developing world, including Latin America. G-20 summit host Argentina is expected to sign a series of deals with China on Sunday during a one-day state visit by Xi.

Apart from trade and climate change, Russia's seizure of Ukrainian vessels drew condemnation from other G-20 members, while the presence of Crown Prince Mohammed bin Salman at the summit raised an awkward dilemma for leaders.

Saudi Arabia's de facto ruler arrived amid controversy over the killing of Saudi journalist Jamal Khashoggi, though Saudi officials have said the prince had no prior knowledge of the murder.

The leader of the OPEC heavyweight had a series of bilateral meetings at the summit, including a closely watched encounter with Russian President Vladimir Putin.