China has retaliated with tariffs of its own on USA imports.
"We are in a position to deal with it and handle it very well", he told reporters.
"I think this is an issue that Trump cares a lot about and is going to use when he campaigns for 2020", Ms O'Neil said.
US Trade Representative Robert Lighthizer said in a statement on Wednesday that he "will examine all available tools to equalize the tariffs applied to automobiles". Washington and Beijing have imposed tariffs on hundreds of billions of dollars on each other's imports after Trump began an effort to correct what he views as China's unfair commercial practices.
Laura Jaitman, the Argentine treasury official shepherding the G20's financing talks, said leaders have made progress on finance and trade and was hopeful a joint statement would be possible.
In May, Trump rejected a statement by fellow leaders of the G7 industrialized economies after a tense gathering ended in acrimony, again over tariffs and trade.
Xi also reiterated that his country will continue to "open up", protect intellectual property rights and encourage fair play - all of which have been identified as problems by the USA government.
Security concerns also weighed on the two-day summit in Buenos Aires.
But on the G20 margins, Trump scored one victory for his "America First" agenda with the signing of a successor to the North American free trade pact Nafta, the US-Mexico-Canada Agreement (USMCA).
In the run-up to November 6 congressional elections, Trump ramped up criticism and accused China of interfering domestically to hurt his Republican Party.
Earlier this month, officials from countries attending a major Asia-Pacific summit failed to issue a joint statement for the first time after the US delegation clashed with China over trade and security.
Nearly an hour after the gathering, White House press secretary Sarah Huckabee Sanders said, "Today, before the start of the G20 summit, President Trump met during breakfast ... the two leaders reiterated their shared commitment to face regional challenges such as Venezuela and China's predatory economic activity".
Australia and U.S. reaffirm economic ties at G20.
Trump has long railed against China's trade surplus with the United States and Washington accuses Beijing of not playing fairly on trade.
Canadian Prime minister and his wife Sophie joined President Macri and his wife Juliana, as the group posed for photos outside the Argentina President's Olivos residence on Thursday.
"Capitalism and the G20 want to exploit the natural resources and force us to work from 12 to 14 hours a day", said Osmar, a Bolivian protester who lives in Argentina.
"Should there be any other aspirations, such as taking advantage of the trade spat to throttle Chinese growth, then an agreement is unlikely to be reached", the newspaper said in an editorial.
"Perhaps we can break through in Buenos Aires or not", he said.
Automakers, dealers, and suppliers have come out against any new tariffs, arguing that they would hurt even US-based companies and the US's global competitiveness. "The US should give its habitual winner-take-all approach to global relations the weekend off", it said.
The Trump administration has come under certain fire for its perceived willingness to look the other way on the gruesome murder to maintain ties with a crucial Middle Eastern ally and big buyer of United States armaments.
USA objections on those fronts have seen two major summits this year, of the Group of Seven democracies and the Asia-Pacific Economic Cooperation forum, end without the once-routine statements.
Saudi Crown Prince Mohammed bin Salman and the Russian President Vladimir Putin.
But while Trump's abrupt decision quashed concerns that the President would repeat his cozy performance alongside Putin during their last meeting in Helsinki, Finland, new allegations by the President's former longtime attorney Michael Cohen revived questions about Trump's financial ties to Russian Federation as he arrived for the global summit.