Aust, Japan urge better US-China ties

(Australian Associated Press)

Australia and Japan have warned China and the United States to settle their differences over trade and political issues using existing rules, rather than spark a new "cold war".

The comments come after a meeting in Sydney on Wednesday between Foreign Minister Marise Payne and Defence Minister Christopher Pyne and their Japanese counterparts Taro Kono and Takeshi Iwaya.

They also precede a G20 finance ministers meeting in Bali on Thursday where Treasurer Josh Frydenberg will tell the world's most powerful treasurers to recommit to free trade, amid the United States' protectionist "America first" approach.

President Donald Trump has slapped billions of dollars worth of tariffs on Chinese products and China has retaliated with similar tax hikes.

Vice President Mike Pence also attracted outrage from China when he delivered a speech in which he accused the Chinese government of stealing American intellectual property, seeking to interfere in US politics and wanting "nothing less than to push the United States of America from the Western Pacific".

Senator Payne, who was recently in the US for talks, told reporters bodies such as the World Trade Organisation were best placed to deal with differences.

"Our view is always that these things are best resolved within the rules construct that has been used over very many years around the WTO and similar," she said.

"So we would encourage both parties to do that."

Mr Kono said for countries to prosper they needed to abide by the International rules-based order.

"No country wishes for a new cold war," he said.

Mr Frydenberg earlier said exports were crucial for Australian jobs.

"So my message to my fellow G20 finance ministers will be that free trade equals more jobs, free trade equals more investment and free trade means higher economic growth," he said.

Former federal Labor treasurer Wayne Swan says countries should speak out against the "incredibly disruptive" actions of the US on the global economy.

Mr Swan, who will also attend the Bali meeting, says Australia and developing Asian countries would bear the brunt of a trade war.

"We are all very interconnected. When something goes wrong in one area it can quickly spread if we don't have a decided and firm response from international authorities," Mr Swan told Sky News on Wednesday.

The International Monetary Fund on Tuesday cut its global growth forecast for 2018-19 by 0.2 per cent to 3.7 per cent, citing the negative impact of new US trade measures.

"It's even more important that countries like Great Britain, Australia, Canada, the Europeans, the Japanese speak out very clearly and succinctly about the importance of good policy," Mr Swan said.

"When you see the state of politics and policy in the United States and its actions, which are incredibly disruptive to the established global order."

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