China vows to 'fight to the end' in trade war with US, despite Australian calls for calm

China's Ambassador to Australia has vowed his country will "fight to the end" in its trade war with US President Donald Trump, adopting a defiant stance even as Prime Minister Scott Morrison urged the superpowers to calm their trade tensions.

In a speech in Canberra, Cheng Jingye squarely blamed Washington for the rising temperature, despite its own widely criticised trade practices such as intellectual property theft, domestic subsidies and the forcing of foreign investors to hand over their technology know-how.

Chinese Ambassador to Australia Cheng Jingye speaks at a Australia China Business Council networking event held at Parliament House in Canberra.Credit: Dominic Lorimer

"China is willing to work together with the US to reach a win-win solution on the basis of equality and mutual respect," Mr Cheng told the Australia China Business Council.

"There is no winner in a trade war. China doesn't want the trade war. Nonetheless it will firmly safeguard strong legitimate rights, interests and development rights.

"As we have made it clear, China's open to negotiations but we will also fight to the end if needed."

He slammed the Trump administration's tariffs on Chinese goods, which he said breached World Trade Organisation rules, threatened global growth and only harmed the US. He said China was trying to resolve the tensions through dialogue.

He was speaking after Mr Morrison called on both the US and China to resolve their trade dispute in ways that did not harm other countries, such as Australia, and warned that his government would "not just sit back and passively await our fate" if the superpowers kept their current collision course.

Immediately after his combative remarks about the US, Mr Cheng pivoted to a plea for Australia and China to work together.

"Mutual political trust and mutual beneficial co-operation are just like two wheels that will smoothly drive our bilateral relations forward. Both of them are indispensable," he said.

"The relationship between China and Australia can only be steadily and increasingly improved when both wheels are spinning with the same speed and in the same direction, mutually reinforcing each other."

This meant both sides respecting one another's national interests and societies and - in a pointed jab at Australia's national security concerns about some Chinese investment - take a "non-discriminative" approach to foreign investment.

"China and Australia's economies are highly complementary. China's door will … open even wider. So there is enormous potential and opportunity for both countries to co-operate in areas of economic trade, investment, finance, technology, science and innovation.

"So it's vitally important that both sides should build a fair and non-discriminative environment for the other side's investment rather than intentionally set up obstacles to the detriment of mutually beneficial co-operation."

Mr Cheng also credited the Chinese Communist Party and his nation's socialist political and economic system with the extraordinary growth the country has enjoyed, which he insisted would continue on its current trajectory.

While there were many reasons for the stellar growth, the most important was "the unswerving adherence to the leadership of the Chinese Communist Party and parts of socialism with Chinese characteristics".

"The party always puts people first. It has assumed the responsibility all along to seek happiness of the Chinese people … its mission is to meet the people's ever-growing needs for a better life."