China urges U.S. to 'pull back from the brink' on trade as tensions rise

China has urged the United States to "pull back from the brink" as U.S. President Donald Trump's plans for tariffs on up to $60 billion US in Chinese goods, while events in the South China Sea and at the United Nations suggest a broader pattern of worsening relations.

The proposed tariffs sent shivers through financial markets as investors foresaw dire consequences for the global economy if trade barriers start going up.

Trump is planning to impose the tariffs for what he says is misappropriation of U.S. intellectual property. A probe was  launched last year under Section 301 of the 1974 U.S. Trade Act.

"China doesn't hope to be in a trade war, but is not afraid of engaging in one," the Chinese commerce ministry responded in a statement. "China hopes the United States will pull back from the brink, make prudent decisions, and avoid dragging bilateral trade relations to a dangerous place."

In a presidential memorandum signed by Trump on Thursday, there will be a 30-day consultation period that only starts once a list of Chinese goods is published. That effectively creates room for potential talks to address Trump's allegations on intellectual property theft and forced technology transfers.

Though the White House has said the planned tariffs were a response to China's "economic aggression," Trump said he views China as "a friend" and the two sides are in negotiations.

A Chinese commerce ministry official said both sides were in touch.

Still, it is unclear under what terms China and the U.S. are willing to talk, with Beijing adamant that the U.S. tariffs constitute a unilateral move that it rejects.

China showed readiness to retaliate by declaring plans to levy additional duties on up to $3 billion US of American imports including fruit and wine in response to U.S. import tariffs on steel and aluminum, which were due to go into effect on Friday.

Tensions in South China Sea

A U.S. Navy destroyer also carried out a "freedom of navigation" operation on Friday, coming within 12 nautical miles of an artificial island built by China in the South China Sea, U.S. officials told Reuters, a move likely to further anger Beijing.

The operation was the latest attempt to counter what Washington sees as Beijing's efforts to limit freedom of navigation in the strategic waters.

The officials, speaking on condition of anonymity, said the USS Mustin traveled close to Mischief Reef in the Spratly Islands and carried out manoeuvring operations. China has territorial disputes with its neighbours over the area.

Neither China's Foreign nor Defence Ministries immediately responded to a request for comment.

In the past, Beijing has reacted angrily to such moves, saying they are provocative.

The U.S. military has a longstanding position that its operations are carried out throughout the world, including in areas claimed by allies, and they are separate from political considerations.
  
Washington has criticized China's construction of islands and build-up of military facilities in the sea, and is concerned they could be used to restrict free nautical movement.

China's claims in the South China Sea, through which about $5 trillion US in ship-borne trade passes each year, are contested by Brunei, Malaysia, the Philippines, Taiwan and Vietnam. The U.S. military put countering China and Russia at the centre of a new national defence strategy it recently unveiled.

Squabbling at UN

Meanwhile in New York, China and the U.S clashed on Friday at the UN Human Rights Council, where the U.S. delegation rejected a resolution brought by Beijing that it said sought to glorify Xi Jinping's "win-win" approach.

U.S. diplomat Jason Mack called for a vote on China's text on "mutually beneficial cooperation," which was then easily adopted by the 47-member forum. The U.S. delegation cast the only "no" vote, while Britain, Japan, and Australia were among those abstaining.

"The 'feel good' language about mutually beneficial co-operation is intended to benefit autocratic states at the expense of people whose human rights and fundamental freedoms we are all obligated as states to respect," Mack said.

Referring to Chinese spokespeople, he added: "They have been clear about their intent to glorify their head of state by inserting his thoughts into the international human rights lexicon."

Friction over Taiwan

Trump has also riled China by signing a new Taiwan Travel Act last Friday. It allows unrestricted travel by U.S. officials to meet with members of Taiwan's government and for Taiwanese officials to visit the U.S. under "respectful conditions," during which they are allowed to meet with their counterparts, including those from the departments of state and defence.

China has already lodged a protest over the act, saying it violates U.S. commitments not to restore formal exchanges severed when Washington switched diplomatic recognition from Taipei to Beijing in 1979.

Beijing urges the U.S. to hold to previous undertakings, cease "any kind of official exchanges and interactions with Taiwan, and properly deal with the Taiwan-related issue with caution so as to avoid severe damage to the China-U.S. relations and peace and stability in the Taiwan Strait," Chinese foreign ministry spokesperson Hua Chunying said at a regularly scheduled briefing.

On Tuesday, Chinese President Xi Jinping warned that any attempt to separate any part of China from the nation would be "doomed to failure," a message implicitly directed at Taiwan and the U.S. Xi said China would continue to seek peaceful unification with the island, from which it separated amid civil war in 1949, although China has refused to rule out using force to bring Taiwan under its control.