China is set to impose tariffs of up to 10% on $75bn of goods imported from the US as the trade battle between the two superpowers escalates.

Agricultural goods, crude oil and small aircraft are among the products being targeted.

The announcement drew an instant response from President Trump who threatened to retaliate.

However, the tariffs are themselves a response to Mr Trump’s plans for a 10% tax on $300bn of goods from China.

Nevertheless, Mr Trump took to Twitter to insist that US firms find an alternative to China.

“Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies home and making your products in the USA,” he tweeted.

“I will be responding to China’s tariffs this afternoon.”

China’s new tariffs will range between 5% and 10% and will apply to more than 5,000 goods coming from the US.

Beijing will also revive a 25% tariff on US car imports that it lifted earlier in 2019 in a goodwill gesture as the two countries tried to negotiate a trade agreement.

Carmakers responded, warning that the tax would put US jobs at risk.

“When these tariffs were initially imposed by China in 2017, American exports of finished vehicles dropped by 50%,” said John Bozzella, who represents car manufacturers. “We can’t let that happen to American workers again.”

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