In retaliation to the US, China has proposed tariffs on $50 billion worth of American goods, including cars, chemicals and soybeans sparking fears of a trade war between the US and China. This comes after the Trump administration announced it will place a 25 percent tariff on Chinese products like televisions, medical devices, aircrafts and batteries, aimed at penalising China for its trade practices.

The Chinese government has outlined plans to make it far more costly to import over 100 types of American goods into the country. This includes pork and beef, fruit and wine. The outcome is hoped to penalise the Agricultural industry within the United States.

The majority of trade between the two countries however will not be heavily impacted, currently valued at almost $650 billion per annum. But as the world watches on, the question remains as to how likely it is for a full-blown trade war. China remains a crucial market for companies such as John Deere and Apple and economists agree that if this battle continues, the countries threaten a commercial relationship vital to the world economy.

Jie Zhao, a senior researcher at the Fudan University in Shanghai has spoken out about her opinion on the matter. “We should negotiate in a professional way,” Ms. Zhao said, “and make it less ideological and emotional.”

It is said that the duelling taxes will likely have a limited effect on the overall US economy but will effect everyday consumers. The debate will lead to higher prices for most products from televisions. For certain industries including agriculture and manufacturing, the economical effects could prove to be severe.

A stubborn Trump took to twitter to address criticism that he had sparked a trade war.

“We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the US. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue.

He then also added: “When you’re already $500 Billion DOWN, you can’t lose!”

The final implementation of any tariffs by the US and China is till to be determined over the coming weeks and is not set in stone just yet. More to come.