Beijing says it will take countermeasures and "stand its ground to the end" if the United States pushes ahead with total tariffs of more than 100 per cent on China, as other Asian nations scramble to cut deals with Donald Trump to avoid or limit the levies.
Mr Trump's so-called "liberation day" tariffs are set to hit countries across Asia hard, with some poorer nations facing levies of up to 49 per cent.
The levy on Chinese imports to the US could be 104 per cent come Wednesday, US time, after Donald Trump threatened to hike the rate unless China dropped its retaliatory 34 per cent tariff.
After the US president's announcement on Monday, China's Ministry of Commerce issued a statement on Tuesday saying China "firmly objects" to the additional tariff and urged the US to remove the levy.
"If the United States follows through with escalating its tariff measures, China will resolutely take countermeasures to safeguard its own interests," said a ministry spokesperson.
"The so-called 'reciprocal tariffs' imposed by the United States on China are entirely groundless and constitute a typical act of unilateral bullying.
"By threatening to escalate tariffs on China, the United States is compounding its error and further revealing its coercive nature, something China will never accept.
"If the United States persists in going its own way, China will stand its ground to the end."
US customs began collecting a universal 10 per cent tariff on goods from its trading partners on Saturday, which Mr Trump said on Monday had already collected "billions of dollars".
"This is despite the fact that the biggest abuser of them all, China, whose markets are crashing, just raised its Tariffs [sic] by 34%, on top of its long term ridiculously high Tariffs [sic] (Plus!), not acknowledging my warning for abusing countries not to retaliate," Mr Trump wrote on Truth Social.
Asian markets fall further
Global markets plunged again on Monday.
Shares in Taiwan dropped by 10 per cent — the biggest percentage fall in one day on record.
China's Shanghai Composite Index (SCI) followed, dropping 7 per cent — its worst day in five years.
Hong Kong's Hang Seng dropped 13 per cent, the biggest single-day drop since 1997.
The SCI had lost as much as 9 per cent before China's sovereign wealth fund stepped in to stabilise the market.
Japan's Nikkei 225 closed at a one-and-a-half-year low after losing 7.8 per cent, led by the country's banks, which have shed almost a quarter of their market value in three trading days.
South Korea's Kopsi lost 5.6 per cent.
Australia's share market shed $110b in value, closing 4.2 per cent lower.
All major stock markets in Europe also lost ground.
Derek Wallbank, senior editor at Bloomberg, told ABC's The World program that the market reactions stemmed from tariffs going further than anticipated.
"This [tariff policy] is not something that Donald Trump is new to — the scale of this though, is different to what he pursued in his first term," Mr Wallbank said.
Chinese officials met with big American companies including Tesla and GE Healthcare at the weekend, as it looked to businesses directly to help manage the fallout of the tariff announcement.
According to a readout of the meeting with 20 companies, a vice-minister of commerce, Ling Ji, said: "The root of the tariff problem is in the US."
"We hope the American companies can address the problem at its root … issue reasonable statements, take concrete actions, and work together to safeguard the stability of the global supply chain," Mr Ling said.
[THE WORLD Bloomberg]China bullish in face of US tariffs
In an opinion piece published in Chinese state media on Sunday, Beijing appeared "unfazed" by the new US levy, explaining its economy had continued to develop and progress despite the US trade war, which started with the first Trump administration in 2018.
"It should be noted that China is a super-large economy, and we have a strong ability to resist the impact of tariff bullying by the United States," read the opinion piece in the People's Daily.
"In recent years, we have been actively building a diversified market, and our dependence on the US market has been decreasing."
It noted that interest rate reductions were one fiscal tool that Beijing could use to reduce the impact of the trade war domestically.
The piece finished with a quote from China's President Xi Jinping saying: "China's economy is an ocean, not a small pond."
Chinese foreign ministry spokesperson Lin Jian said threats and pressure were not the right way to deal with China, adding the tariffs were "typical unilateralism and protectionism, and economic bullying".
Donald Trump last week said China had "panicked" by introducing a 34 per cent tariff on American goods.
However, China economist Max Zenglein said the reaction in state media showed China was both "unfazed" by this latest round of US tariffs and it was a scenario the country had been prepared for.
"Despite some of the expected challenges for its economy, the fallout in response to the US alienating some of its key allies presents an almost historic opportunity to seize the moment to advance China's global standing," added Dr Zenglein, chief economist at the Mercator Institute for China Studies in Berlin.
The Lowy Institutes lead economist Roland Rajah echoed that sentiment, saying the sweeping tariffs are a "geo-strategic win" for China.
"China was the 'Status Quo' player and the US is seen as the disruptive player in the region," Mr Rajah said.
Asian countries approaching tariff problem differently
While Mr Rajah said China could "inflict pain" on the US, most countries in Asia had not retaliated with tariffs because "retaliation doesn't really make sense for most countries" who import very little from America.
"Often what they need from the US might be important as well in terms of say advanced equipment," he said.
He added it was a different story for China, which could both inflict pain on the US while also not wanting to look like it was "being bullied" by the world's largest economy.
"To the extent that this is a bit of game, they're playing it," he said.
Countries across Asia are facing significant tariffs.
[TARIFF TABLE]Most countries have been attempting to strike deals with the Trump administration before the tariffs take effect on April 9, US time.
Donald Trump's chief economic advisor Kevin Hassett told American media that more than 50 countries had contacted the US president to begin negotiations at the weekend.
Cambodia and Vietnam are facing significant tariffs and are also the most heavily reliant on exporting to the US.
Vietnam has already offered a 0 per cent tariff as part of negotiations with the US, which was being watched as a "test case" by other countries.
"For other countries besides China and Europe … the question is can a country like Vietnam actually negotiate?" Mr Rajah said.
"It's not clear that there's going to be any resolution before these tariffs kick in [on April 9] and obviously Trump is the big question mark. He's the one that actually makes the decision.
"No-one really knows what he's going to do."
Japan sending delegation to Washington
Japan has decided to send a negotiating team to the US to try to negotiate on a 25 per cent tariff on auto imports and a 24 per cent tariff on other goods.
Japanese Prime Minister Shigeru Ishiba called Donald Trump on Monday and told him his policy was extremely disappointing.
"I've told the president that Japan has been the biggest investor in the United States for five straight years and the tariff policies could hurt our Japanese companies' investment capabilities," Mr Ishiba said, adding the pair agreed to continue constructive negotiations.
Thailand's Prime Minister Paetongtarn Shinawatra said at the weekend that the country would increase imports of energy, aircraft and agricultural products from the US in response to the 36 per cent tariff on Thai exports to the US market.
Most countries have already said they will not employ retaliatory tariffs against the US.
Vietnam's leader To Lam spoke with the US president on Friday — a phone call Donald Trump said was "very productive".
Cambodia has asked the US to postpone implementing the tariff. Cambodian Prime Minister Hun Manet wrote to Mr Trump saying: "Cambodia proposes to negotiate with your honourable administration at the earliest convenient time."
Taiwan's President Lai Ching-te has also offered 0 per cent tariffs as a starting point for negotiations, as other countries look to diplomatic channels to ease the pain.
Indian Prime Minister Narendra Modi's administration said it was looking at a clause in the tariff policy that could offer a possible reprieve for trading partners who "take significant steps to remedy non-reciprocal trade arrangements".
Indonesia won't implement reciprocal tariffs on the US, with the country's Chief Economic Minister Airlangga Hartarto saying that it would opt for diplomatic negotiations instead.
Roland Rajah said Indonesia was less reliant on exports to the US and was also hit with a lower tariff than other countries, meaning it was in a better position to handle the impact of the levy.
Derek Wallbank said the European Union and ASEAN nations were already talking about the best way to negotiate with the US "either all together directly" or with a level of collaboration to make their case.
Malaysia will reportedly push for a united ASEAN bloc response at a meeting this week.
ABC/wires
[THE WORLD IV USA VIEW]
