China hits back at US with tariffs on $50-bn goods Tit-for-tat levies further escalate trade war fears, markets witness sell-off

China hit back quickly on Wednesday against the Trump administration’s plans to slap tariffs on $50 billion in Chinese goods, retaliating with a list of similar duties on key US imports including soybeans, planes, cars, beef and chemicals.

The Chinese tax agency said the date the 25 per cent tariff hike might take effect would be announced later depending on what US President Donald Trump's government does about plans to raise duties on a similar amount of Chinese goods. A Commerce Ministry statement said China was protecting its "legitimate rights and interests."

The speed with which the trade struggle between Washington and Beijing is ratcheting up – China took less than 11 hours to respond with its own measures – led to a sharp selloff in global stock markets and commodities.

Chinese authorities warned they would respond with the "same strength" after US authorities issued a list of Chinese goods on Tuesday targeted for 25 per cent duties in response to complaints Beijing pressures foreign companies to hand over technology.

China's list of 106 products included the biggest US exports to China, reflecting Beijing's intense sensitivity to the dispute over complaints it pressures foreign companies to hand over technology.

China's list included soybeans, the biggest US export to China, and aircraft that weigh up to 45 tonnes. That excludes much heavier Boeing jetliners, leaving Beijing additional high-profile targets for possible future rounds of the conflict. Other products on the list include American beef, whisky, passenger vehicles and industrial chemicals.

The proposed Chinese increase mirrors the possible 25 per cent tariffs on goods announced on Tuesday by the Trump administration including aerospace, telecom and machinery.

The Office of the US Trade Representative has issued a list targeting 1,300 Chinese products, including industrial robots and telecommunications equipment. But the proposed tariffs wouldn't take effect before a public comment period ends May 11.

The clash reflects the tension between President Donald Trump's promises to narrow the multibillion-dollar US trade deficit with China and the ruling Communist Party's ambitious development plans. Those include using access to China's vast market as leverage to induce foreign automakers and other companies to help create or improve industry and technology. China said it would immediately challenge the US move in the World Trade Organisation.

"It's our hope that both sides will bear in mind our interests and work in a constructive manner to jointly tackle the challenges we face instead of acting in a willful way or doing anything that will significantly undermine the interests of both nations," said a deputy finance minister, Zhu Guangyao, at a news conference.

Zhu warned against expecting Beijing to give in.

"Pressure from the outside will only urge and encourage the Chinese people to work even harder," he said.

The American list strikes at high-tech industries seen by Chinese leaders as the key to the country's economic future.

Companies and economists have expressed concern growing global economic activity might cool if other governments are prompted to raise their own import barriers. The dispute "may compel countries to pick sides," said Weiliang Chang of Mizuho Bank in a report. Chinese policies "coerce US companies into transferring their technology and intellectual property to domestic Chinese enterprises," said a USTR statement.