"If what the USA wants is to escalate a trade war with China, then so be it".
China is putting pressure on the EU to issue a strong joint statement against President Trump's trade policies at the summit but is facing resistance, European officials said. American officials worry US industrial leadership will be eroded by Chinese plans to create tech champions in fields including robotics, biotech and artificial intelligence.
President Donald Trump's tariffs on $34 billion of Chinese products officially went into effect on Friday and China has responded by imposing their own tariffs on over 500 American products, including Ohio's second largest export soybeans. "Tariffs will negate gains made by the public from tax reforms and deregulation, push up USA production costs, damage the competitiveness of businesses and their workers, and force companies to look outside the U.S.to maintain production".
"After the USA activated its tariff measures against China, China's measures against the U.S. took effect immediately", said Lu Kang, spokesman for the Foreign Ministry. These include soybeans and automobiles. "The yuan will certainly face intensifying depreciation pressure again going forward if China fails to de-escalate trade tensions with the US", he wrote.
"A rise in trade protectionism would increase global risk aversion and disproportionately affect non-USD countries due to their relative economic openness", analysts at Bank of America Merrill Lynch said in a recent note.
Brussels shares Washington's concern about China's closed markets and what western governments say is Beijing's manipulation of trade to dominate global markets.
Japan's main stock index, the Nikkei 225, gained 1.1 percent while the Shanghai Composite Index added 0.5 percent.
Tokyo closed 1.1% higher, but Hong Kong fell 0.5% in late trading. They also offered a rare moment of humour in an increasingly acrimonious row between the world's top two economies.
It also is rooted in the clash between American notions of free trade and Beijing's state-led development model.
Relations have soured between US President Donald Trump's administration and that of Chinese President Xi Jinping since they met in Beijing a year ago, sparking fears of an all-out trade war. On Thursday aboard Air Force One, the president vowed to implement tariffs on an additional $16 billion worth of imported Chinese goods within the month.
If his administration went ahead with that threat, it would raise the total of targeted Chinese goods to potentially $550 billion - more than the $506 billion that China actually shipped to the United States previous year.
Signs of nervousness about the trade outlook were evident elsewhere in global markets with the Japanese yen and the Swiss franc firm against the dollar while core US and German bonds were in demand. Other media carried similar reports.
"In effect, the Trump administration is behaving like a gang of hoodlums with its shakedown of other countries, particularly China", the state-run China Daily newspaper said in an English language editorial on Friday.
But a manufacturing survey from the Institute for Supply Management shows they are not alone, while other companies say uncertainty is delaying investment plans. "I think products made in China are the best", said one shopper in a Beijing grocery story, who gave his name as Yang.
The American Chamber of Commerce in China appealed to both sides to negotiate a settlement.
Reflecting expectations that small USA companies are less at risk than multinationals from tariffs, the Russell 2000 index has outperformed the S&P 500, Dow and Nasdaq since early March.