Australia's treasurer has ducked suggestions new US tariffs against China amount to "trade bullying".
China's ambassador to Australia applied the label while declaring Beijing did not want a trade war with Washington, but was not afraid of fighting one.
"Our view is that whether it's the United States or China, they are best served by a global trading system without these tit-for-tat tariffs," Treasurer Josh Frydenberg told ABC radio on Thursday.
"With a rules-based system where the (World Trade Organisation) is central to dispute settlement."
One in five Australian jobs are connected to trade, and the government has a slew of free trade agreements in place.
"We will continue to make the case - privately and publicly - for an open, rules-based free trade system without this tariff war we have seen play out," Mr Frydenberg said.
China's ambassador has said China is playing by the rules and disputes everything America claims.
The ambassador cited the proverb: "He who tries to blow out the other's oil lamp will set his beard on fire."
Mr Frydenberg said the US had some legitimate concerns around intellectual property, subsidies for various sectors, and the forced transfer of technology.
"There are some legitimate issues that the Americans have made," the treasurer said.
"But at the same time, we want cool heads to prevail, we want the disputes to be resolved, and we want both sides to be sitting at the negotiating table."
China is Australia's largest trading partner, and America its closest security ally.
The protracted trade spat is having a massive impact on global economic confidence.
As the two superpowers duke it out, Prime Minister Scott Morrison is trying to boost Australian exports into China and build closer trade ties with other countries.
"The truth is that as these things unfold there are opportunities that present along the way as well," Mr Morrison told 5AA Radio.
"There are other countries in our region with which our trade relationship is growing.
"You've got to diversify. That's what you've got to do. But that's not something we've just decided to do. We've been doing it for five and a half years."
Australian Associated Press