While tariffs between the USA and China have led to conflict in the past year, the summit also showed the U.S.is trying to compete with China as both superpowers pledge more aid to developing countries.
O'Neill said that the main sticking points that prevented a joint statement related to "the World Trade Organisation and reform of the World Trade Organisation".
Clashes between the world's top two economies over the rules of global trade blocked agreement on a formal written declaration by the 21 nations represented at the Port Moresby meeting. Yet the trade war has raised the prospect that nations will now need to pick sides, particularly as higher USA tariffs threaten to alter long-established supply chains.
An acrimonious meeting of world leaders in Papua New Guinea failed to agree Sunday on a final communique, highlighting widening divisions between global powers China and the U.S.
"If we have people who always talk about politics engaging in negotiations, we will never have a deal", Long Yongtu said on Sunday.
The Chinese delegates tried to forcibly enter Rimbink Pato's Port Moresby office on Saturday, in an eleventh-hour bid to influence a summit draft communique, but were denied entry, three sources said.
News of the dispute comes as both economic giants engage in a retaliatory trade war, sparked by the US administration's protectionist "America First" policies advocated by US President Donald Trump.
The US is interested in a better relationship "but there has to be change" from China's side, Mr Pence said he told Mr Xi, who responded saying that dialogue is important.
"We have reached a crossroad in history, when we must have a keen appreciation of the trend of our world and take the pulse of the world economy", Xi said. The US is slated to "more than double" current tariffs on China, lifting the targeted tariff rate to 25% across the board. Mr. Pence, pointing to China's trade practices, told Mr. Li: "Things have to change".
Aside from trade, the leaders extensively discussed financing for infrastructure projects and investment in the Asia-Pacific region at a time when China is increasing its influence through Xi's "One Belt, One Road" infrastructure initiative.
Pence also took direct aim at Xi's signature Belt and Road initiative, saying in his speech countries should not accept debt that compromised their sovereignty.
"This is one episode in the hegemonic struggle between the US and China - it will go on for a while", said Kunihiko Miyake, a former Japanese foreign ministry official who is now a visiting professor at Ritsumeikan University.
Xi put forward proposals on building an open economy in the region, nurture new growth drivers, improve connectivity and deepen partnership, among others, said Wang.
"Not a single developing country has been mired in debt difficulties because of its cooperation with China".
"Attempts to form exclusive blocs or impose one's will on others should be rejected", Xi said.
China's former chief trade negotiator has hit out at his country's handling of rising trade tensions with the United States, saying that Beijing is failing to think "deeply enough" about its approach to the conflict.