Donald Trump has threatened to axe the first phase of the US-China trade deal if Beijing misses import targets agreed before the pandemic hit amid growing tensions between the two superpowers.
The US President said he would cancel the agreement struck after lengthy negotiations if China failed to buy an additional $200bn (£161bn) of American goods and services over the next two years as tensions rise about the origins of the coronavirus outbreak. He said: “If they don't buy, we'll terminate the deal. Very simple.”
Mr Trump had hinted he could impose new tariffs on China, claiming he had seen evidence linking a Wuhan disease research laboratory to the coronavirus pandemic - a theory many scientists see as unlikely.
The president said: “I think they made a horrible mistake and they didn't want to admit it. We wanted to go in, but they didn't want us there."
Secretary of State Mike Pompeo also said there was “enormous evidence” for the claim without providing any detail.
China denies the accusations.
Fears that the US-China trade spat will be reignited weighed on investors’ hopes of a recovery from the crisis. Seoul's Kopsi dropped 2.7pc on Monday and Hong Kong’s Hang lost 4.2pc, while markets on the Continent also fell sharply after being closed on Friday.
Meanwhile, formal trade talks between the US and UK will start by video conference on Tuesday.
The first round will last a fortnight and involve 200 officials, with the British side led by senior Department of International Trade mandarin Oliver Griffiths. Talks will be overseen by Crawford Falconer, the department's chief trade negotiation adviser. Future rounds are expected to take place every six weeks.
Ahead of the negotiations, Trade Secretary Liz Truss said: "Increasing transatlantic trade can help our economies bounce back from the economic challenge posed by coronavirus. As we sit down at the negotiating table, be assured that we will drive a hard bargain to secure a deal that benefits individuals and businesses in every region and nation of the UK."
Adam Marshall, director-general of the British Chambers of Commerce, said: “Companies will welcome the focus on helping more UK small and medium-sized enterprises grow their trade with partners in the US, and on finding ways to move goods, people and data across borders between the two countries more smoothly.”