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Trump’s latest warning to enforce an extra complete levy on products from China has been labeled a “typical example” of American hypocrisy, according to the Chinese government.

A official from China’s Commerce Ministry also stated that the nation could enact its own undisclosed “retaliatory steps” if the American leader executes his warning, emphasizing that the country was “not afraid” of a looming trade war.

On Friday, the former president hit back at Beijing’s move to reinforce its regulations for foreign shipments of rare earth minerals, accusing China of “adopting a confrontational stance” and attempting to hold the global community “hostage”.

Additionally, he warned to withdraw from a planned meeting with China’s President Xi, which was expected to take place during a meeting in South Korea later this month.

His statements on Friday shook global markets, with the benchmark US stock index dropping 2.7%, marking its largest decline since earlier this year.

These statements reignited fears of a commercial dispute between the two economic giants.

In May, the respective governments had agreed to remove significant levies on each other’s goods, which had led to concerns of commerce ceasing between the two nations.

Consequently, US tariffs on products from China subject to an additional 30% levy compared with the year’s onset, while items from the United States entering China face a import levy.

China’s latest remarks – issued by the Commerce Ministry in the format of written responses to journalist’s questions – mirrored language from the height of the recent trade conflict.

The remarks condemned United States controls on electronic components while supporting China’s own restrictions on exports on rare earths as “routine measures” to safeguard state interests and that of every country.

The official said that for “many years”, the US had “broadened the definition” of domestic safety, misused overseas sale restrictions and “adopted biased policies against Beijing.

“Turning to” tariff threats is not the correct approach to interact with China,” the spokesperson stated.

“China’s position on a tariff war has always been steady: we do not want one, but we are fearless of one.”

Recently, the Chinese government announced it was tightening foreign shipment restrictions on rare earths and other materials critical for cutting-edge industry.

The action was viewed as a significant step, as the country processes about the vast majority of the global rare earth supply, which are used in products such as renewable energy components and smartphones.

New remarks from Washington and Beijing are being viewed by some as a method of enhancing bargaining power prior to upcoming negotiations.

It is unclear whether a talks between Donald Trump and President Xi, scheduled at a conference in the Republic of Korea later this month, will still proceed.