After several rounds of trade consultations, it seems the world's two largest economies are back at square one. Making matters worse, the trade friction is now taking a toll on the world economy. Americans, too, are feeling the heat from the simmering battle of tariffs. 

What is the atmosphere in Washington? How will it influence the Chinese economy? CGTN Senior Correspondent Tian Wei talked to a group of panelists.

Tim Stratford, the chairman of AmCham China, was in Washington before the trade talks fell apart. "It's really at the end of the week when we saw the sudden turn of events. We talked to 20 members in the Senate, and talked people in think tanks. People were encouraged with the progress of trade talks; we are already looking ahead to how we are going to implement them. So I think we were disappointed to see the breakdown," he said.

However, Stratford added that it is normal to have breakdowns at the end of talks like this. Each side is sort of testing the other to get the best deal. But what is troubling like now is that there's a lot of testing in a public way, which made it harder to compromise.

The Chinese Commerce Ministry said the impact of the trade spat with the U.S. on China's economy is manageable. Beijing will keep an eye on the nation's economic indicators, and take necessary measures to stabilize the economy. The Chinese government vowed to protect the legitimate rights of foreign companies in China, and maintain a stable, fair, transparent and predictable business environment for them. 

For fighting back the uncertainty and maintaining China's growth and trade status, Xiao Geng, a professor at Peking University HSBC Business School, thinks that lots of reforms will come much faster and more forcefully to further implement opening up and reduce costs. So in terms of the Chinese economy, Xiao believes the key driver is domestic demand, while he also admitted the confidence in economy is important. 

"The confidence actually depends on how the government handles the issue. And the government now wants to support private sector and wants to keep opening as well as more stable and long-lasting policies, which will gradually help to restore the confidence, because the Chinese economy today is driven by domestic demand and domestic investments."