In total, Trump has now threatened up to $450 billion U.S. in Chinese imports with tariffs, including another $200 billion USA in Chinese goods if Beijing retaliates after the step Trump announced on Monday. Beijing immediately retaliated with a 25-percent tariff on 545 American products worth $50 billion, which will come into force on the same day.
Stock markets have fallen around the world in the wake of President Trump's latest tariffs threat to China.
USA -listed shares of Chinese companies tumbled, with e-commerce giant Alibaba down 2.3 percent and JD.com off 4 percent.
"Risking a trade war with more tariffs will only invite more retaliation that will cause significant harm to the USA economy", said the group, urging the administration instead to "work with our allies and place coordinated pressure on China to end their harmful trade and investment practices".
In 2017, following the Seoul government's decision to deploy an anti-missile system that China opposed, China forced South Korean retailer Lotte Shopping to suspend operations at many of its hypermarkets in the country for alleged violations of fire-safety rules. "The economics already seemed tight, so I can't imagine you could stack both those tariffs and continue manufacturing competitively in the U.S".
Zhang Zhiwei, chief China economist at Deutsche Bank, said U.S. companies actually may have sold more to China than Chinese firms to the US.
But investors in USA agricultural commodities appeared to be far more anxious.
Overall, however, traders do not expect serious supply shortfalls to result from Chinese crude tariffs against the United States. Higher prices on imported goods could dampen consumer sentiment and pressure inflation.
Tom Orlik, chief economist at Bloomberg Economics, said that in the event that China's exports to the USA weaken in the face of tariffs, the government would likely seek to offset the growth impact with a combination of subsidies to support domestic demand and higher infrastructure investment.
But Navarro dismissed concerns about how the administration's trade policy would affect the financial markets and global economy, saying it will have only a "relatively small effect".
If the USA goes ahead with the new $200 billion tariffs, they are more likely to be directly felt by individuals than the previous round.
"This is a predictable response to a very public effort by the United States to reconcile what it perceives to be trade differences".
Late Tuesday Trump asked his staff Monday to draw up a list of additional goods that should be subject to a 10 percent import tax in the event China retaliates against the original 25 percent tariff announced on $50 billion of imports last week. In a forcefully worded statement, it said Beijing is ready to "defend the interests of the Chinese people and enterprises".
He said China's latest action clearly indicated its determination to keep the USA at a permanent and unfair disadvantage, which is reflected in the massive United States dollars 376 billion trade imbalance in goods.
China bought American goods worth $153.9 billion a year ago, while exports to the United States totaled $429.8 billion, according to customs data.
Trump claimed that because of Canada's high tariffs, Canadians were coming into the USA and "smuggling things back" to avoid the duties.
In announcing the possibility of new $200 billion in tariffs, Trump mentioned that he still has an "excellent relationship" with Chinese president Xi Jinping.
Shares in ZTE dived after the Senate passed legislation on Monday evening that would restore penalties. US bond yields fell in a flight to safety.