China and the U.S. are still working to achieve a trade deal that matches the interests of both sides and the hopes of the world, including eliminating tit-for-tat tariffs, an official said on Saturday.

Chinese Vice Commerce Minister, Wang Shouwen, said he was optimistic about negotiations with Washington, but added any trade mechanism achieved must be equal and fair.

The governments of the world’s two largest economies have been locked in a tariff battle for months as Washington presses Beijing to address long-standing concerns over Chinese practices and policies around technology transfers, market access and intellectual property rights.

Advances in talks drove the White House to indefinitely delay hikes in tariffs on 200 billion dollars worth of Chinese imports that were set to kick in on March 2.

Wang, speaking at a news conference on the sidelines of China’s ongoing annual meeting of parliament, said slapping tariffs on each other was bad for workers, farmers, exporters and manufacturers.

“It hurts investor confidence and delays corporate investment decisions,” said Wang, who has been deeply involved in the trade talks with the U.S.

“Now, the economic and trade teams of the two sides are making full efforts to communicate and negotiate in order to reach an agreement in line with the principles and directions decided by the two heads of states,” he added.

“That is to remove all the tariffs imposed on each other, so that bilateral trade relations between China and the U.S. can return to normal.”

The two countries’ working teams are communicating “day and night”, Wang said.

The trade talks have seen senior officials shuttling backwards and forwards between Beijing and Washington.

Wang said the two countries had been making extra effort to find areas in common.

The U.S. administration has also demanded that China curb generous subsidies and open its domestic market to U.S. firms.

China does not systematically give subsidies to its state-owned firms, said the head of its state assets regulator on Saturday, when asked about international concerns China adopts implicit preferential policies for state-owned enterprises.

“It can be said that China does not have any laws and regulations specifically addressing the issue of subsidies for state-owned enterprises,” said Xiao Yaqing, Head of the State-owned Assets Supervision and Administration Commission (Sasac).

“Therefore, China is currently cleaning up and standardizing various subsidies,” Xiao said on the sidelines of the annual meeting of parliament.

China is working on standardising subsidies to create a level playing field for companies of all types and sizes, he added. It was unclear whether standardising subsidies refers to adjustments of subsidies or their removal entirely.

(Reuters/NAN)