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China announced additional tariffs of 34% on US goods on Friday, 4 April, the most serious escalation in a trade war with President Donald Trump that has fed fears of a recession and triggered a global stock market rout
In the standoff between the world's top two economies, Beijing also announced controls on exports of medium and heavy rare-earths, including samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium to the US.
It also added 11 entities to the "unreliable entity" list, which allows Beijing to take punitive actions against foreign entities.
Nations from Canada to China have readied retaliation in a mounting trade war after Trump raised US tariff barriers to their highest level in more than a century this week, leading to a plunge in world financial markets.
The White House was not immediately available for comment.
In Japan, one of US' top trading partners, Prime Minister Shigeru Ishiba said that the tariffs had created a "national crisis" as a plunge in banking shares on Friday set Tokyo's stock market on course for its worst week in years.
Investment bank JP Morgan said it now sees a 60% chance of the global economy entering recession by year end, up from 40% previously.
US stock futures fell sharply on Friday, signaling more losses on Wall Street, after China retaliated with fresh tariffs a day after the Trump administration's sweeping levies knocked off USD2.4 trillion from US equities.
Divisions and mixed signals
With European shares also heading for the biggest weekly loss in three years, the European Union's trade commissioner Maros Sefcovic will speak to US counterparts.
"The EU will respond in a calm, carefully phased, and above all, unified way, as we calibrate our response," he said on social media. "We will not shoot from the hip – we want to give negotiations every chance to succeed to find a fair deal, to the benefit of both sides."
The EU is divided on how best to respond to Trump's tariffs, including on the use of its 'Anti-Coercion Instrument', which allows the bloc to retaliate against third countries that put economic pressure on EU members to change their policies.
Countries that are cautious about retaliating and thereby raising the stakes in the standoff with the US include Ireland, Italy, Poland, and the Scandinavian nations.
The European Commission is nevertheless trying to finalise a list of U.S. imports worth up to 26 billion euros (USD28 billion) on which to place retaliatory tariffs in response to US tariffs on steel and aluminium.
The Commission, which coordinates trade policy for the EU's 27 members, has still to work out how best to respond to the sweeping tariffs announced by Trump this week and an earlier announcement on car tariffs.
