China vows to fight back if U.S. escalates trade spat

Trump on Monday criticized China for maintaining 25 percent import tariffs on autos compared to the 2.5 percent duties of the USA, calling the relationship "stupid trade".

The Chinese exercises are taking place amid rising tensions between Beijing and Washington over trade, but analysts have also expected the Trump administration to harden its policy on the South China Sea.

China's March exports fell 2.7 percent from a year earlier, lagging analysts' forecasts for a 10.0 percent increase, and down from a sharper-than-expected 44.5 percent jump in February, which economists believe was heavily distorted by seasonal factors.

In this April 12, 2018 photo, Navy personnel of Chinese People's Liberation Army Navy take part in a military display in the South China Sea.

Separately, China's dollar-denominated trade surplus with the United States rose 19.4 percent in the first quarter.

Against the backdrop of recent tensions, customs bureau spokesman Huang Songping repeated China's line that it is not looking for an advantage over its trading partners. "We hope trade relations can return to the track of healthy and stable development". U.S. President Donald Trump called for the tariffs to protect U.S. metal makers from cheap imports.

He reiterated that China does not want a trade war with the United States: "We believe that this trade friction is not conducive to China's interests, nor is it conducive to the interests of the U.S.". "The Thursday parade could also serve as deterrence to maritime hegemony, making adversaries think twice before attempting to harm China's core national interests", Song said. "He's going to open it up, take down a lot of the trade barriers - maybe all of them", Trump told lawmakers on Thursday. China says the Taiwan Travel Act violates USA commitments not to restore formal exchanges severed when Washington switched diplomatic recognition from Taipei to Beijing in 1979.

Trump has portrayed the issue in a more favourable light.

During Trump's first year in office the surplus reached record highs - $375 billion by United States counting, or $276 billion according to Chinese data. Chongqing, one of China's largest cities, is situated deep in the country's economic heartland and far from the political center of Beijing.

Beijing announced last week it would slap a 25 percent import duty on soybeans from the United States in response to Trump's tariffs on Chinese exports.

Total trade between the two nations rose 13 per cent during the quarter, China's data showed, but the first shots in the latest trade spat were not likely to be felt in the recording period.

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