China’s government slammed President Trump on Friday for a “reckless” threat to impose tens of billions of dollars in import tariffs and warned of retaliation, as Asian stock markets slid on fears that this could be the start of a wider trade war.

Trump threatened Thursday to slap tariffs on up to $60 billion in Chinese imports. China announced a more modest package of potential tariffs of its own and vowed to “fight to the end” to defend its interests if a trade war breaks out.

Tokyo’s main Nikkei share index closed down 4.51 percent Friday, while share indexes in Shanghai and Seoul fell by more than 3 percent, following similar drops in U.S. indexes Thursday. China claimed that the slides back its stance.

“I think this represents a vote of no-confidence in the relevant U.S. policies and actions,” said Chinese Foreign Ministry spokeswoman Hua Chunying. “It also demonstrated that the international community is concerned about the recklessness and danger of U.S. policies and actions.”

Some in the United States, she told a news conference, were “a little bit arrogant” and have “totally underestimated” both China’s resolve and the cost the United States would have to pay in the event of a more serious dispute.


A man rests as he keeps an eye on stock price movements displayed on a screen at a securities company in Beijing on Friday. (Nicolas Asfouri/AFP/Getty Images)

Trump has given his administration 15 days to come up with a list of tariffs, after which there would be 30 days of public consultation — and almost certainly intense lobbying from within the United States. But officials say they are determined to press ahead with what one called “a long-overdue attempt to rectify what for a very, very long time has been a very imbalanced commercial relationship.”

That will almost certainly spell a further escalation of tensions.

“If the tariffs go ahead as planned, then we believe China will retaliate. It is impossible to imagine that they cannot,” Robert Carnell, head of Asia-Pacific research at ING in Singapore, wrote in a client note. “And then we expect the U.S. to retaliate further. This can turn ugly on a global scale very quickly.”

Hours after Trump’s announcement, China’s Commerce Ministry gave the first indication of potential targets for retaliation, which it linked to Trump’s earlier move to impose tariffs on steel and aluminum imports.

It said it has compiled a list of 120 products worth nearly $1 billion, including fresh fruit and wine, upon which it would impose a 15 percent tariff if the two countries fail to resolve their trade differences “within a stipulated time.” It added that a 25 percent tariff on other goods, including pork and aluminum, could be imposed “after further evaluating the impact of U.S. measures on China.”

Arthur Kroeber, managing director of Gavekal Dragonomics, said Beijing is sending a “carefully calibrated” message that it will stand up to Trump, while trying not to escalate the spat into a confrontation that could seriously threaten the global trading system.

“The larger part of China’s strategy, though, is to position itself as the good guy in the global economy, protecting the rules of the game from Trump’s lawless attacks,” he said.

Wei Jianguo, a former vice commerce minister, said China has different lists of possible tariffs ready depending on Trump’s next move. He said China would target states and industries that are important to Trump, such as autos, planes, IT and semiconductors, wheat, corn and soybeans.

“China’s response should follow the principle of a precision strike,” Mei Xinyu, a researcher at a Commerce Ministry think tank wrote in an opinion piece for China Daily. “China should first take measures to deal a blow to the industries in U.S. states that helped Trump win the 2016 presidential election and those states whose political leaders are still backing him in this year’s midterm election.”

But Mei also recommended selling U.S. Treasury bonds and undermining the U.S. stock market to make Trump “feel the pain.”

Not everyone believes the two nations are headed inexorably for a trade war. Shen Dingli, deputy dean of the Institute of International Affairs at Shanghai’s Fudan University, said the numbers announced so far were “actually quite small” compared with overall trade flows. Last year, the United States imported $506 billion in goods from China and recorded a trade deficit of $375 billion.

“There’s no trade war; it’s just a trick,” he said. “The U.S. came with trade tariffs to say it’s not happy. China said, ‘Okay, I’ll make changes, but I need time.’ ”

Shen said China knows that it has benefited “in unfair ways” from trade between the two nations and is prepared to open its markets further. He predicted tough talks ahead.

But Ni Feng, deputy director of the Institute of American Studies at the Chinese Academy of Social Sciences in Beijing, said there was no doubt the situation is “deteriorating.” Chinese President Xi Jinping sent two high-level envoys to Washington last month, but neither managed to resolve the situation, he pointed out.

Indeed, U.S. officials say they have listened to Chinese pledges to open up the country’s markets for too many years and are no longer interested in hearing empty promises.

“The only thing we are interested in seeing from the Chinese side is action,” one senior official told reporters, speaking on the condition of anonymity because the official was not authorized to speak on the record.

If a trade war does erupt, both sides are likely to share the blame.

Trump argues that previous U.S. presidents were far too soft on China. But critics say he has missed an opportunity to build an effective international coalition against China’s trade practices, angering allies in Europe, North America and Asia by threatening to slap blanket tariffs on steel and aluminum imports — even if exemptions are being carved out — and acting unilaterally this week in a way that could undermine the global trade system.

U.S. diplomats, business leaders and many experts, though, blame China for consistently failing to address long-standing demands to open its markets further.

The American Chamber of Commerce in China said its members wanted the U.S. administration to advocate more strongly for a level playing field and reciprocal treatment to improve market access — despite concerns that the current actions could disrupt the global economy.

“That the U.S. is willing to risk these disruptions indicates how serious the U.S. Administration finds China’s forced technology transfer, cyber theft, and discriminatory industrial policies,” AmCham China Chairman William Zarit said in a statement. “We feel that focusing on reciprocal treatment while maintaining strong communications between the governments will be the best path forward to get to our goal of a level playing field based on fairness.”

If there is a trade war, the first shots were fired by China many years ago, U.S. officials say, and it is Beijing that has long “gamed” the rules of the World Trade Organization for its own benefit.

“China has done a very, very good job since it entered the WTO in 2001 of carefully constructing its protectionist policies and other unfair policies in a way that allows them to skirt WTO disciplines,” the senior U.S. official said. Others said China has misjudged how determined the Trump administration is to resolve some of these issues and is mistaken now if it underestimates Washington’s resolve.

“It’s remarkable how badly Xi Jinping has mishandled and damaged the U.S.-China relationship,” tweeted Ely Ratner, a senior fellow at the Council on Foreign Relations who served as deputy national security adviser to Vice President Joe Biden.

“Maybe he wanted it this way, but Xi missed every opportunity to negotiate good-faith solutions to trade and investment disputes,” Ratner wrote.

Now the U.S. administration appears to be taking aim at the entire structure of the Chinese economy, with its huge state-owned companies and state-backed attempts to corner key technologies of the future.

For some in China, that sends a worrying message.

“Conflict is unavoidable,” said Hui Shousheng, a researcher at the Tsinghua National Strategy Institute in Beijing. “It’s a structural problem which has nothing to do with either the trade deficit or employment. There are many political factors behind this, such as the fight for [global] leadership and the conflict over ideologies.”

Meanwhile, Japan so far has been excluded from the list of countries that have won exemptions from the U.S. steel and aluminum tariffs, which went into effect Friday, despite being a key American ally in Asia. Trade Minister Hiroshige Seko called that “extremely regrettable” and said Tokyo would continue to push “patiently” to be exempted from the tariffs, news agencies reported.

Shirley Feng, Liu Yang and Luna Lin contributed to this report.