China has announced retaliatory tariffs of 34% on US imports, taking effect from April 10, signaling a sharp escalation of a major trade war that could lead to a global recession.

Beijing has previously imposed tariffs of 15 percent on imports of coal and liquefied natural gas (LNG) from the US in retaliation for Washington’s 10 percent levies on Chinese goods.

Retaliatory tariffs of 34% on US imports were announced on Friday. 

“For all imported goods originating from the US, an additional tariff of 34% on top of the current applicable tariff rate will be imposed,” China’s finance ministry announced in a statement.

“The purpose of the Chinese government’s implementation of export controls on relevant items in accordance with the law is to better safeguard national security and interests, and to fulfill international obligations such as non-proliferation,” the ministry added.

Referring to Trump’s imposition of “reciprocal tariffs”, China’s state council tariff commission stated that the US action “is not in line with international trade rules, seriously undermines China’s legitimate rights and interests, and is a typical unilateral bullying practice.”

China has added 16 US companies and organizations to its export control list, restricting Chinese companies from doing business with them.

Moreover, China’s industry associations have unanimously condemned the tariffs. China’s National Textile and Apparel Council said that it “supported the government’s forceful measures” and that the US had “damaged the resilience of the global textile industry’s supply chain.”

The giant economy has also filed a lawsuit against the US with the World Trade Organisation.

US President Donald Trump has responded to Beijing’s announcement. “China played it wrong, they panicked – the one thing they cannot afford to do!” Trump wrote on social media.

Trump on Wednesday announced that China would be hit with a 34-percent tariff, on top of the 20 percent he imposed earlier this year, bringing the total new levies to 54 percent.

Experts believe that the mounting trade war is a blow to global trade.

Stephane Ekolo, a market and equity strategist for Tradition in London, told Reuters: “China comes out swinging with an aggressive response to Trump’s tariffs. This is significant and is unlikely to be over, hence the negative market reactions. Investors are afraid of a ‘tit for tat’ trade war situation.”

Wall Street’s main indexes posted their biggest single-day percentage decline in years on Thursday, while investment bank JP Morgan has raised the probability of a global recession by the end of the year to 60%, up from a previous estimate of 40%.