Ben Chu
BBC Verify
A full-scale trade war between China and the US is in prospect after President Donald Trump imposed 125% tariffs on Chinese goods imports.
China has retaliated by hiking its tariffs - or taxes - on goods imported from America to 125%.
What does this escalating trade conflict mean for the world economy?
How much trade do they do?
The trade in goods between the two economic powers added up to around $585bn (£429bn) last year.
Though the US imported far more from China ($440bn) than China imported from America ($145bn).
That left the US running a trade deficit with China - the difference between what it imports and exports - of $295bn in 2024. That's a considerable trade deficit, equivalent to around 1% of the US economy.
But it's less than the $1tn figure that Trump has repeatedly claimed this week.
Trump already imposed significant tariffs on China in his first term as president. Those tariffs were kept in place and added to by his successor Joe Biden.
Together those trade barriers helped to bring the goods the US imported from China down from a 21% share of America's total imports in 2016 to 13% last year.
So the US reliance on China for trade has diminished over the past decade.
Yet analysts point out that some Chinese goods exports to the US have been re-routed through south-east Asian countries.
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For example, the Trump administration imposed 30% tariffs on Chinese imported solar panels in 2018.
But the US Commerce Department presented evidence in 2023 that Chinese solar panel manufacturers had shifted their assembly operations to states such as Malaysia, Thailand, Cambodia and Vietnam and then sent the finished products to the US from those countries, effectively evading the tariffs.
The new "reciprocal" tariffs Trump imposed on those countries - which he has now paused - could therefore push up the US price of a wide range of goods ultimately originating in China.
How might this affect other countries?
The US and China together account for such a large share of the global economy, around 43% this year according to the International Monetary Fund.
If they were to engage in an all-out trade war that slowed their growth down, or even pushed them into recession, that would likely harm other countries' economies in the form of slower global growth.
Global investment would also likely suffer.
There are other potential consequences.
China is the world's biggest manufacturing nation and is producing far more than its population consumes domestically.
It is already running an almost $1tn goods surplus – meaning it is exporting more goods to the rest of the world than it imports.
And it is often producing those goods at below the true cost of production due to domestic subsidies and state financial support, like cheap loans, for favoured firms.
Steel is an example of this.
There is a risk that if such products were unable to enter the US, Chinese firms could seek to "dump" them abroad.
While that could be beneficial for some consumers, it could also undercut producers in countries threatening jobs and wages.
The lobby group UK Steel has warned of the danger of excess steel potentially being redirected to the UK market.
The spillover impacts of an all-out China-US trade war would be felt globally, and most economists judge that the impact would be highly negative.