China fires back at Trump’s tariff threat, accusing the US of ‘double standards’

China has vowed it will retaliate if Donald Trump follows through on his '100% tariff threat'.

The US president on Friday threated to impose additional tariffs of 100% on Chinese goods, effective 1 November, in response to their decision to limit the export to the US of rare earth minerals.

China has accused the United States of 'double standards', with ongoing trade talks taking place between the two super powers.

The US had previously lowered tariffs on China down from 125 to 30 percent, with Trump's latest move sparking fears of igniting a fresh trade war.

Trump and his Chinese counterpart, Xi Jinping are also due to meet in South Korea at the end of October.

Speaking to Stephen Grootes on The Money Show, Dr Martyn Davies, chairperson of the Industrial Policy Group says there's a stand off between China and the US.

"Let's see if the Chinese will back down before that date, if that meeting does go ahead. The Chinese ministry of commerce has come out and said publicly, we don't want a trade war, but we don't fear it either," says Davies.

"China is ahead, by far on all things AI. It accounts for roughly one-third, 30% of global manufacturing value-add...it really is an economy that price is being driven and competitiveness is being determined by over-capacity, and that over-capacity is now being exported," adds Davies.

Listen to the full interview in the audio player below.