China announces additional 34% tariffs on US imports in retaliation over Trump's 'Liberation Day' levies

By Emma Soteriou

China will impose a 34% retaliatory tariff on imports from the US after Donald Trump announced his 'Liberation Day' levies.

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The new tariff matches the rate of the US "reciprocal" tariff imposed by Trump.

The US approach was "inconsistent with international trade rules, seriously infringing upon China's legitimate rights and interests, and is a typical unilateral bullying act", the Chinese foreign ministry said.

"China has always been a staunch defender of the international economic and trade order and a staunch supporter of the multilateral trading system.

"We urge the US to immediately correct its wrong practices and cancel its unilateral tariff measures."

Read more: Global stock markets plunge further but Trump insists tariffs policy 'going well'

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Beijing's commerce ministry also said it will impose more export controls on rare earths, which are materials used in high-tech products such as computer chips and electric vehicle batteries.

Meanwhile, 27 US companies will be added to a list of companies subject to trade sanctions or export controls.

Imports of chicken from two US suppliers, Mountaire Farms of Delaware and Coastal Processing, have also been suspended as part of the retaliatory measures.

It comes after Chinese customs repeatedly detected furazolidone, a drug banned in China, in shipments from those companies.

A lawsuit has also been filed with the World Trade Organisation over the tariffs.

The UK's top stock market index plummeted after China announced the reciprocal tariff.

The FTSE 100 dropped by about 4%, losing around 150 points in the space of an hour and hitting the lowest level since December.

European indexes were also suffering steep falls with Germany's Dax tumbling around 4.5% and the Cac 40 down 4% just before midday.

Trump first announced the tariffs on Wednesday evening outside the White House.

He said the import taxes, which range from 10% to 49%, would do to US trading partners what they have long done to the US.

He maintains they will draw factories and jobs back to the US.

"Taxpayers have been ripped off for more than 50 years," he said. "But it is not going to happen anymore."