Want to work out 'phase one' trade deal with US: Xi

China wants to work out an initial trade agreement with the United States and has been trying to avoid a trade war, but it is not afraid to retaliate when necessary, President Xi Jinping said on Friday.

"We want to work for a 'phase one' agreement on the basis of mutual respect and equality," Xi told representatives of an international forum, according to a pool report.

"When necessary we will fight back, but we have been working actively to try not to have a trade war. We did not initiate this trade war and this is not something we want."

Xi was at the Great Hall of the People responding to questions from representatives of the New Economy Forum organised by Bloomberg LP in Beijing.