President Donald Trump is facing a potential trade war with China, with the country threatening to slap economic sanctions on the United States over the weekend.
In a statement, the Trump administration said it would consider imposing economic sanctions against all countries who do not immediately comply with a February 2018 accord aimed at curbing China’s aggressive territorial claims in the South China Sea.
“China’s actions are contrary to the principles of international law, and will be met with appropriate and swift enforcement measures,” the statement said.
“The administration is considering imposing the necessary sanctions on China to ensure that they respect the obligations of the international community.”
On Saturday, China launched a “stronger, more aggressive” military exercise in the disputed waters in the contested South China sea.
China has also warned that if the United Nations Security Council fails to take action, Beijing will move to conduct an underwater military drill.
The United States, which has not taken any steps to challenge Beijing’s claim in the area, has imposed several rounds of sanctions against China, including the suspension of all imports from China.
China also suspended the sale of its most valuable oil, the world’s second largest, to the United State, and imposed a moratorium on all new deals.
China’s Foreign Ministry spokesman Hong Lei on Saturday said he had seen no evidence that the United Sates military exercises would affect the status quo.
“I think we can see the military exercises and we are in a good position, he said, adding that there was no change in the status of the South East Asia peace process.”
But the military exercise came as Trump’s administration faces an unprecedented economic crisis.
Trump’s economic policy team is struggling to balance his campaign promise to make America great again with the demands of his populist base, who fear rising costs, soaring debt and the loss of jobs.
In the past week, Trump has been repeatedly criticized by Republican leaders for the way he has handled his relationship with the financial industry, which is also reeling from a severe economic downturn.
Trump has promised to overhaul the tax code to help middle-class Americans and cut the corporate tax rate to 35% from 39%.
He has also promised to revive the nation’s manufacturing industry, with a focus on small- and medium-sized businesses.
“Our plan is to give our workers a bigger slice of the pie, so that our workers can go out and make a bigger profit,” Trump said during a recent speech in Alabama.
But on Sunday, the White House said the economic measures would be in place as long as China continued to “respect the international law and abide by the commitments that we made”.
“The U.S. government has taken a strong position against China’s illegal activities in the East and South China Seas, and we continue to stand with our allies, our friends, and our allies around the world,” a White House statement said, citing the Trump-era commitments made during his election campaign.
The statement was one of the first public statements from Trump’s White House about the planned economic measures.
Trump and his allies have said the moves are designed to force China to reverse its actions in the region, but Beijing has repeatedly said they are necessary to prevent a military conflict and that it is willing to hold the line.
The Chinese military said on Saturday it was conducting “surgical and strategic” exercises in the waters off its coast in an attempt to “provide the U.N. with an accurate and timely assessment of the situation”.
The statement did not address the economic actions or provide any details about what measures the U the United Kingdom and Australia were considering.
Australian Foreign Minister Julie Bishop said on Sunday the United states and Australia had “all options” in response to the threat of Chinese military actions in its territorial waters.
“We need to work with the United Nation to determine what those options are,” Bishop told ABC radio.
“I can’t give you any more information than that.”
A U.K. foreign office spokeswoman told CNN the country had not yet been informed of the military drills and could not comment on the matter.
In Washington, the State Department did not respond to a request for comment.
China is not the only nation to take economic measures to retaliate against the UnitedS.
The U, meanwhile, is working to ensure the Trump transition team meets its commitment to meet with world leaders, including Russia, China and other nations, after Trump took office.
The Trump administration is also trying to push ahead with a new trade deal between the UnitedStates and Canada, despite congressional opposition to the controversial pact.
The trade pact, which Trump is expected to sign, has faced significant opposition from Democrats and Republicans alike.
The deal has been heavily criticized by Democrats and labor unions who argue it would create a major new trade barrier in the US, as well as by trade unions and some environmental groups.
A senior administration official said the trade deal could be finalized this year.
The official spoke on condition of anonymity to discuss internal deliberations.
Trump, however, has said the new trade pact will benefit the American economy and create jobs.