World leaders gathered in Japan Friday for one of the most high-stakes and fractious G20 meetings in years, with a bruising US-China trade war, geopolitical tensions, and climate change on the agenda.

The two-day summit in the city of Osaka will be dominated by trade issues, with all eyes on whether US President Donald Trump and Chinese President Xi Jinping can reach a truce in a dispute that has been hugely damaging for the world economy.

But world leaders will also be seeking to tamp down tensions between Washington and Iran that have led to fears of a new conflict in the Middle East.

And they will look for common ground on climate change, with Japan hoping to unite European leaders who want strong action with an American leadership committed to withdrawing from the Paris climate agreement.

Trump set a combative tone even before arriving in Japan, taking aim at India, which he accused of seeking to increase tariffs on US goods.

And he said China was eager for a trade truce because its economy was "going down the tubes", appearing to also threaten another $325 billion in levies in addition to the $200 billion Washington has already imposed.

He struck a slightly more conciliatory tone on Friday morning, in brief remarks ahead of talks with Japan's Prime Minister Shinzo Abe.

"I know we are going to have a very successful day," the US leader said. He is scheduled for a long-awaited meeting with Xi on Saturday, his first since last year's G20.

Efforts by the rivals to reach a trade deal fell apart in May, ramping up a spat that has proved a serious headwind for the world economy.

Experts believe there is little chance of a full deal at the G20, saying the best hope is for a truce that would avoid Washington imposing new tariffs and ramping up the conflict.

But even a truce is not guaranteed, with the Wall Street Journal reporting Thursday that Beijing will not agree to any deal unless Washington lifts its ban on Chinese telecoms firm Huawei.

Australia's Prime Minister Scott Morrison, who met Trump in Osaka on Thursday, said the dispute would "take a lot to work through".

"I walked away with the view that this is going to be tough, because there are some very serious issues that they're trying to resolve," he told Australia's Channel 7 Sunrise programme.

- Iran tensions -

Trade will be far from the only contentious issue on the table, with climate change emerging as another sticking point.

French President Emmanuel Macron has said he wants strong wording in support of climate change action but Washington is unlikely to back any statement endorsing the Paris climate change deal, from which it plans to withdraw.

Japanese officials say they hope to find common ground, despite Macron insisting the issue is a "red line", but concede it will be tough.

"The work to consolidate various opinions is expected to be difficult," a Japanese official admitted to reporters Thursday.

Macron has also he would not sign a major trade deal between the EU and Latin American countries that some hope might be reached at the G20 if Brazil withdraws from the Paris agreement.

German Chancellor Angela Merkel, who arrived in Osaka Friday after suffering a second public episode of trembling, has raised concerns about deforestation in Brazil but said the issue should not scupper the trade deal.

A German government spokesman insisted Friday morning that Merkel "is doing well", but the shaking scare has raised fears about her health.

Looming over the talks will be continuing tensions in the Middle East. Trump said before heading to Japan that any war with Iran "wouldn't last long".

That assessment is unlikely to find favour among G20 leaders, with Macron warning Thursday: "there are no short wars."

When a war begins, he said, "we know when it starts, but rarely when it will end."

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