Both the U.S. and China benefit so much from international trade that neither will risk disaster over retaliatory tariffs spurred by President Trump's desire to balance exports between the two nations, billionaire investor Warren Buffett says.

Challenges will arise "when one side may want to win a little bit too much, and you have a certain amount of tension, but the world will not sacrifice world prosperity" based on those differences, the chief executive officer of Berkshire Hathaway told investors Saturday at the Omaha, Neb.-based conglomerate's annual meeting.

"It’s just too big and too obvious that the benefits are huge, and the world’s dependent on it in a major way for its progress that two intelligent countries will do something extremely foolish," Buffett said. "We both may do things that are mildly foolish from time to time."

U.S. stock markets have taken a less optimistic view of trade tensions, with China and elsewhere in the world, that were fueled by duties the Trump administration established in March. Stiff across-the-board levies on steel and aluminum, which sparked an outcry from U.S. allies, were followed by tariffs on $50 billion of Chinese imports.

When the world's second-largest economy retaliated, Trump threatened customs assessments on $100 billion more, as U.S. equities retreated from January records. The blue-chip Dow Jones Industrial average is now 8.8 percent below its high of 26,616.

Investors are "waiting to see what’s going to happen on trade," Trump told reporters outside the White House on Friday morning, promising to win a better deal for the U.S. and reiterating his admiration of President Xi Jinping.

Economists and analysts have expressed repeated concerns, however, that Trump's protectionist policies might instead spark an international trade war that undermines the economic benefits of a GOP-led tax cut trimming the top corporate rate to 21 percent from 35 percent.

The president has responded that some short-term pain may be required as the U.S. revises decades' worth of trade policies that he says have undermined U.S. business.

In particular, Trump has cited a U.S. trade deficit that grew to $568.4 billion last year, driven largely by China. That country's government, which met this week with a U.S. delegation including Treasury Secretary Steve Mnuchin and trade chief Robert Lighthizer, said Friday that "considerable differences" remain between the two parties, though progress was made.

"The U.S. and China are going to be the two superpowers of the world economically, and in other ways, for a long, long time," Buffett said Saturday. "We have a lot of common interests, and like any two big economic entities, there are times when there will be tensions, but it is a win-win situation when the world trades, basically, and China and the U.S. are the two big factors in that."