China slammed the threats as "blackmail" and warned that if the U.S. followed through with the tariffs it would "have no choice but to take comprehensive measures of a corresponding number and quality and take strong, powerful countermeasures".
Security guards walk in front of containers at the Yangshan Deep Water Port in Shanghai, China on April 24, 2018.
Beijing on Tuesday accused Donald Trump of "blackmail" and warned it would retaliate in kind after the United States president threatened to impose fresh tariffs on Chinese goods, pushing the world's two biggest economies closer to a trade war.
Trump announced on Monday evening that he'd asked U.S. Trade Representative Robert Lighthizer to draw up a list of $200 billion in Chinese imports that the U.S. could impose a 10 percent tariff on. "In the near-term, we would expect to see volatility in markets as they attempt to price in the net impact of tariffs", said Michael Olivia, a financial planner with Westpac Wealth Partners.
He doubts the latest dispute would damage the relationship between the two countries.
President Donald Trump is escalating his trade fight with China.
The standoff, mostly over China's drive to supplant United States technological dominance, threatens to tip "the U.S. and China into a downward spiral like the world hasn't seen since the trade war that plunged us deeper in the Great Depression and into the Second World War", Matt Gold, professor of global trade law at the Fordham Law School and a former USA trade official, told Associated Press.
Broadly the escalation of tariff rhetoric was very worrying Jacobi said.
China's tariffs had themselves been a reaction to Trump's announcement on Friday that the US would be imposing a 25 percent tariff on $50 billion of Chinese goods.
If Trump carries through on all his trade threats, the result would be higher costs on virtually all the goods that the U.S. imports from China.
"If China increases its tariffs yet again, we will meet that action by pursuing additional tariffs on another United States dollars 200 billion of goods".
The president, who called NAFTA "one of the worst deals ever made by this country, a disaster", said again he may pursue separate deals with Mexico and Canada instead of sticking with the three-nation deal.
Trump's comments came hours after the top USA diplomat accused China of engaging in "predatory economics 101" and an "unprecedented level of larceny" of intellectual property. Apple has reportedly been anxious about retaliation from China.
"Most damaging for businesses and investment is perhaps rising uncertainty caused by lasting trade disputes, which could delay or significantly change business and investment decisions", warned economists at UBS.
Pompeo raised the trade issue directly with China last week, when he met in Beijing with President Xi Jinping and others.
By comparison, Americans returning to the United States from Canada are granted duty-free exemption of US$200 for any absence from their country of less than 48 hours.