Beijing vows firm answer to new USA tariff threat

This would come in addition to the tariffs on $50 billion worth of imports, should China retaliate; a move which effectively confirms that a damaging trade war is underway, leaving many questioning where the end point will be?

He said the action by Beijing "clearly indicates its determination to keep the United States at a permanent and unfair disadvantage, which is reflected in our massive $376 billion trade imbalance in goods".

Trump directed the US Trade Representative's office to begin drawing up a list of $200 billion worth of Chinese goods to hit with a 10% tariff, dwarfing the size of previous trade actions against China. Trump said that could result in another round of tariffs, which would all together threaten $450 billion worth of Chinese goods.

China retaliated with $50 billion worth of US exports, including agricultural products.

Trump cited China's imposition of charges on USA goods - which came in response to Washington's opening salvo in a mounting trade dispute - as "unacceptable". She also spoke with U.S. Secretary of State Mike Pompeo over the weekend.

The impact of the trade conflicts "will lead to serious consequences for economic growth and job creation and hurt those that are most vulnerable across the globe", Blakeman said. "The problem is, such a tactic is unlikely to work with China", said Kota Hirayama, senior emerging markets economist at SMBC Nikko Securities Inc in Tokyo.

On Tuesday, the U.S. Dow Jones Industrial Average opened more than one percent lower. "Again and again the USA has been provoking a trade war".

The Trump administration's new tariffs focused mainly on industrially manufactured goods like machines, robots, motors, medical devices and pharmaceuticals.

With Wall Street sliding further into the red on Tuesday and nerves on edge among lawmakers in Trump's Republican Party, senior White House economic aide Peter Navarro defended the new trade policy.

He said China's recent claims of "openness and globalisation" are "a joke".

The White House on Monday started the process to impose tariffs on $200 billion of Chinese goods, on top of $50 billion already announced.

The needs of China and the U.S. are not contradictory, given that the USA wishes China to further open its market access while China focuses on upgrading its industrial structure and improving its position in the global value chain, said Sang Baichuan, director of the Institute of International Business at the University of International Business and Economics in Beijing.

Reciprocal market access remains a particular concern, according to the survey, with 100 percent of firms in the information technology and telecommunications sector reporting Chinese companies enjoyed better access in Europe than European companies had in China.

Rising trade tensions also put new deals and investment at risk.

Then China followed suit, unveiling 25 per cent duties on US$50 billion in USA imports - matching the United States rates.

Clayton Allen of Height Capital Markets said in a report Trump's "provocative" moves were aimed at winning quick Chinese concessions.

In response, China announced tariffs on $34bn of United States goods including agricultural products, cars and marine products which will also take effect from 6 July.