China says "fully prepared" if trade war kicks off this week

The European Union is possibly as bad as China just smaller' Trump said on'Sunday Morning Futures on Fox News

The European Union is possibly as bad as China just smaller' Trump said on'Sunday Morning Futures on Fox News

Noting reports that the United States could add a tax on essentially every product shipped from China, Gao said "using the tariff stick to bully on trade runs against the trend of the times".

Imports from the USA are seen at a supermarket in Shanghai, China April 3, 2018.

Washington said earlier it would implement 25 per cent tariffs on US$34 billion worth of Chinese products on Friday, to which China responded by saying it would retaliate with punitive action of the same scale and on the same day.

"There is a lot of concern I think about the effect a long term trade war might have but actually if you look at the data we're seeing, the economic data is not that bad", said Michael Hewson, chief markets analyst at CMC Markets in London.

But comments made by the Customs Tariff Commission of the State Council, China's cabinet, suggest that is unlikely.

China will impose the taxes on a total of $34 billion worth of US goods.

"China will not bow down in the face of threats and blackmail and will not falter from its determination to defend free trade and the multilateral system".

President Donald Trump has accused China of unfairly acquiring us technology and limiting market access for finance and technology firms - claims that China denies.

There was no mention of the trade tensions in reports on the latest travel advisory posted by the Chinese Embassy in Washington.

In the currency market, the yuan bounced back from an 11-month low following moves by China's central bank on Tuesday to calm jittery financial markets.

While China has signalled a willingness to buy more American goods to balance out the deficit, it has refused to trade away what it views as an essential part of its economic future.

"With strong manufacturing capability and huge market potential, China's development is hard to suppress". Tabloid newspaper Global Times, which is owned by the Communist Party mouthpiece People's Daily, said the escalating trade dispute would create chaos around the world.

"The USD 34 billion US tariffs figure has been mostly factored by the markets and focus is now on what the United States says on the remaining $16 billion", Ichikawa said.

A USA industry source said: "There is a 99 percent chance that tariffs go into force on Friday".

In a commentary on Wednesday, China's official Xinhua news agency said China and Europe "should resist trade protectionism hand in hand".

The industry source said Beijing had been unable to address the Trump administration's concerns on Chinese trade policies in at least five key area, including forced technology transfers, Chinese industrial overcapacity, government subsidies, SOE reform, and Beijing's restrictions in the cloud computing industry.

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