“We hope that both parties can maintain reason, not act emotionally, and avoid a trade war,” he said.

He said there would be no winners and to use the word “war” went against the idea of trade, which is based on negotiation, consultation and dialogue.

However, he sidestepped a question about whether China would replace the US as the world’s leading country.

Donald Trump’s administration had previously demanded that the trade surplus between the two nations should be cut by US$100 billion.

When asked about Sino-Russian relations, Li noted that China and Russia saw their decline in trade reversed last year, after noting that President Xi Jinping had extended congratulations to Vladimir Putin for his re-election.

North Korea

Li welcomed all efforts to resolve the nuclear crisis in the Korean peninsula when he was asked about the proposed meeting between the US President and North Korean leader Kim Jong-un in May.

“The peninsula is China’s close neighbourhood and directly concerns China’s own interests, so you can well imagine how much attention we have paid to the situation there,” Li said.

Japan

Li said he was willing to consider a formal visit to Japan amid signs of improving ties between the two nations. But he warned efforts should be made to ensure relations continued to improve.

Taiwan and Hong Kong

Li reiterated that Beijing will not tolerate the idea of Taiwanese independence and warned “external forces” not to use Taiwan as a bargaining chip against China.

On Hong Kong and Macau, Li emphasised the benefits of a more integrated economy amid Beijing’s push to boost the Greater Bay Area.

Li insisted both Hong Kong and Macau would continue to enjoy a high degree of autonomy, but emphasised they were part of the same country.

Economy

Li said China was capable of forestalling systemic financial risks.

“The fundamentals of the Chinese economy are sound and the financial sector is stable,” Li said.

He also said China had cut its budgeted fiscal deficit because revenues proved stronger than expected.

The Premier also referred to a recent crackdown on tycoons, saying the economy faced some risk in the same way “that a big tree invites winds”. However, he insisted there was enough capital in the banking system.

Li also promised that China would continue to improve its business environment.

“We will cut the time it takes to open a business in China by another half and we will reduce the time required for reviewing a project application by another half,” he added.

Welfare and employment

Li said the country now has 241 million people aged 60 or above, around 17.3 per cent of the total population. He said China would continue to work on its pension system to make sure the elderly get their money.

On employment, he said China aims to generate more than 13 million new urban jobs this year, while setting a minimum target of 11 million.

Li said at least three million new rural migrant workers would be seeking jobs in cities this year. “It is the responsibility of the government to provide stable job opportunities for these people,” he continued.

He noted that China has around 280 million rural migrant workers in cities, who have played important roles in the country’s drive towards urbanisation.

He said that 2018 would see a record 8.2 million college graduates and 5 million graduates from secondary vocational schools looking for work along with a million demobilised military personnel and workers affected by efforts to cut overcapacity.

“We must work very hard to ensure there will be jobs for these people, and do our best to avoid zero-employment families,” said Li.

For more details, comments and colour from Beijing, check out our live coverage of Li’s two-hour press conference below. App users, please allow a few seconds for our blogging widget to load.