China on Friday struck back against US President Donald Trump's trade offensive, intensifying the expanding and unpredictable dispute between the world's two largest economies.

Late Friday, China announced it was expanding its existing complaint against the United States at the World Trade Organization, hours after the countries slapped tit-for-tat tariffs on billions of dollars of cross-border trade.

Beijing called the new stage of the confrontation -- which began when Washington pulled the trigger on 25 percent duties on $34 billion annual imports of Chinese machinery, electronics and other goods -- "the largest trade war in economic history."

And China's foreign ministry said retaliatory tariffs of equal size and scope had taken effect "immediately."

There was confusion about exactly what US products would be hit in the initial wave of tariffs as China's Commerce Ministry had not published an updated list.

Economists have warned escalating trade frictions could throttle global growth and strike at the heart of the world trading system, causing economic shockwaves and potentially disrupting years of global growth.

US trade data released Friday showed exports hit a record, as importers bumped up purchases, particularly of tariff-targeted US soy beans, to build up supplies before the new duties hit.

Analysts said this was the quiet before the storm, with US exports likely to fall off in the third quarter as both sides feel the effects of worsening trade relations.

The new tariffs could just be the opening skirmish in the trade war, as US President Donald Trump has vowed to hit as much as $450 billion in Chinese goods, the vast majority of that country's imports.

That would add to disputes underway with Canada, Mexico and the European Union, which could worsen if he goes ahead with threatened tariffs on autos.

China's government also announced it was adding this round of US tariffs to an existing complaint filed with the WTO in April shortly after Washington unveiled the threat to punish Beijing for its policies on intellectual property.

- Economic threat -

Months of dialogue between the two economic superpowers, including in the WTO, appeared to have failed, with Trump warning just hours before the tariffs came into effect that Washington was ready to escalate the dispute with duties on hundreds of billions of dollars more in Chinese imports.

Trump repeatedly has slammed what he describes as Beijing's underhanded economic treatment of the United States. The US trade deficit in goods with China ballooned to a record $375.2 billion last year, stoking his ire.

US officials accuse China of building its industrial dominance by stealing the "crown jewels" of American technological know-how through cyber-theft, forced transfers of intellectual property and state-sponsored corporate acquisitions.

A US court on Friday imposed the maximum $1.5 million fine for theft of trade secrets by the Chinese company Sinovel in a case that typified Washington's complaints about Beijing's conduct.

Prosecutors said AMSC lost 700 jobs and more than $1 billion in shareholder equity after Sinovel stole technology, including software, used in producing and operating wind turbines.

Sinovel has agreed to pay AMSC a total of $52.5 million in restitution.

Despite dire warnings about the impact on the US, Trump believes the robust American economy can outlast its rivals in the current battle.

But China also believes its economy, with a greater focus on domestic demand and a reduced dependence on exports, can ride out the storm.

China central banker Ma Jun said the first punches will have only a "limited impact" on the nation's economy, trimming GDP growth by 0.2 percentage points.

With only $130 billion in US imports to retaliate against, Beijing has said it will take "qualitative" and "quantitative" measures against the US, triggering fears it could cripple the operations of US multinationals operating there.

- Russia joins the fray -

China's Premier Li Keqiang said on a visit to Sofia that "A trade war benefits no-one because it hurts free trade and the multilateral process."

Global markets initially wobbled at the news but soon forged higher with Wall Street finishing up solidly on bullish employment numbers while Asian and European stocks also cast aside their worries, at least for now.

On the streets of Beijing, there were some concerns that prices would rise due to the tariffs but also a determination to support the Beijing authorities in the trade war.

"I will try my best to support domestic products. I think products made in China are the best," said one shopper in a Beijing grocery story, who gave his name as Yang.

Moscow also announced Friday it had slapped 25 percent tariffs on some US goods, joining the global push-back against Trump's offensive.

Weapons of trade war: What might China have up its sleeve?
Beijing (AFP) July 7, 2018 - The first shots have been fired in a trade war between China and the United States that experts say could be damaging for the world economy.

The two superpowers on Friday imposed tit-for-tat tariffs on billions of dollars of cross-border trade.

While US President Donald Trump has brushed off warnings that trade frictions with powerful partners like China could harm the US, Beijing has other weapons in its arsenal beside tariffs to cause damage in a fight.

- Cruising for a bruising -

Tom Cruise films, Starbucks coffee, the iPhone X and the Buick are all best-sellers in China and authorities could find all sorts of ways to make life difficult for them, says Louis Kuijs, Asia analyst at Oxford Economics.

China "has less ammunition left in terms of imposing tariffs but history shows that there are various other measures it could take to inflict pain on US companies," said Kuijs.

He cited "scaled-up health, safety and tax checks, delaying the import of goods and boycotts of US goods."

Chinese port officials have already started upping inspections of American pork and cars, causing severe delays.

- Buick boycott -

General Motors now sells more cars in China than it does in the US -- and many other iconic American brands now derive a large proportion of revenue from the fast-growing Chinese market.

China could either tie up these firms in red tape or encourage an effective boycott by Chinese consumers, experts said.

Mark Williams, chief Asia economist at Capital Economics, said Beijing could arrange a "propaganda campaign, which allows officials to remain at arm's length from the resulting disruption to sales."

"In the past, these have proved both effective and fast," said Williams, noting that similar campaigns against South Korea and Japan at times of political tension "led to 50-percent falls in car sales by those countries' firms in a single month."

Last year, Chinese consumers suddenly turned against South Korean retailer Lotte, which was forced to shut three-quarters of its shops in China after providing Seoul with land to deploy an American anti-missile shield that Beijing opposes.

- School's out -

China may start limiting the number of big-spending tourists and its 350,000 students that head to the US each year, which would have a big impact on the American market.

"Chinese spending on travel and education in the US is similar in size to its spending on US soybeans and aircraft -- the two largest goods purchases," said Williams.

China has previously limited tour groups to pressure Taiwan and South Korea, noted the expert.

However, he added: "China may feel that US universities have limited leverage over the Trump administration and limiting student numbers could undermine efforts to upgrade China's technical and scientific capabilities."

- Boeing blow-out -

Boeing sells a quarter of its planes in China, the second-biggest market in the world, and the US aerospace giant is neck-and-neck with European rival Airbus.

This could be another pressure point, as most Chinese airlines are under state control with their orders strictly piloted by Beijing.

Even though orders are planned for the next five years, nationalistic state-run tabloid Global Times has already sounded a warning, saying Beijing could "adjust the sales volumes."

- Debt and devaluation -

With its enormous currency reserves, China holds some $1.2 trillion in US treasury bonds and officials have reportedly started to slow or halt their purchases.

While some see this as a powerful bargaining chip with Washington, it is a double-edged sword for Beijing as dumping the bonds would cause self-inflicted losses.

Another weapon at Beijing's disposal is the yuan, tightly controlled by the central bank, which it could depreciate to bolster exporters.

But again, this could be a self-inflicted wound since it might provoke sizable capital outflows out of China.

Julian Evans-Pritchard from Capital Economics said: "While a weaker currency could offset some of the economic damage done by US tariffs, the wider risks to financial stability would not be worth taking."

- Korean co-operation -

If economic weapons don't work, Beijing could turn to politics. Trump relies heavily on Chinese cooperation to rein in the nuclear ambitions of North Korea's Kim Jong Un -- especially in terms of maintaining sanctions.

Trump may suddenly find China less accommodating on this explosive dossier if the trade war expands.

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US, China fire first shots in 'largest trade war in economic history'
Washington/Beijing (AFP) July 6, 2018
The US and China on Friday launched tit-for-tat tariffs on each other's imports, the opening shots in what Beijing called "the largest trade war in economic history" between the world's top two economies. At the stroke of midnight Washington time, the US pulled the trigger on 25-percent duties on about $34 billion in Chinese machinery, electronics and high-tech equipment, including autos, computer hard drives and LEDs. The foreign ministry in Beijing said retaliatory measures "took effect immedi ... read more