UPDATE 1-Top U.S. trade official says EU, U.S. 'working hand in hand' on China

European Union leaders did not take issues with Chinese trade policy as seriously as they should have in the past, but the United States and the EU are now "working hand in hand" at the World Trade Organization on China's non-market economic policies, top U.S. trade official Clete Willems said on Monday.

The United States and the EU want to work together on joint projects that provide market-based alternatives to state-led initiatives "that can come with strings attached," Willems said in remarks made at the U.S. Chamber of Commerce. Next month China is hosting its second summit for its Belt and Road initiative, which envisions connecting China with Asia, Europe and beyond with massive infrastructure spending, but the United States will not be sending high-level officials to the event.

Washington views Beijing as a major strategic rival. The United States has said it views the initiative as a way of spreading Chinese influence overseas and saddling low-income countries with unsustainable debt using opaque projects. Willems said the United States and the E.U. have made progress on soybeans in trade talks. Washington and Brussels have also been discussing building liquefied natural gas terminals and infrastructure, Willems said. (Reporting by Chris Prentice; Writing by Makini Brice Editing by Chizu Nomiyama)