The United States hiked tariffs on Chinese imports Friday and Beijing announced it was retaliating against American goods in a technology dispute between the world's two biggest economies that U.S. President Donald Trump says he is prepared to escalate.

Washington increased tariffs at 12:01 a.m. ET on $34 billion US worth of Chinese imports, a first step in what could become an accelerating series of tariffs.

Retaliatory measures "took effect immediately," said a Chinese Foreign Ministry spokesperson, Lu Kang. Lu gave no details, but the Communist Party newspaper People's Daily said the customs agency was carrying out a plan announced last month to impose 25 per cent tariffs on a $34-billion list of American goods including soybeans, pork and electric cars.

China also announced a fresh case against the U.S. at the World Trade Organization.

This is a potential concern for the outlook of corporate investment and consumption around world. - Tai Hui, JP Morgan Asset Management

Companies worry the spiralling dispute could chill global economic growth, but Asian financial markets took Friday's developments in stride.

Japan's main stock index, the Nikkei 225, gained 1.1 per cent while the Shanghai Composite Index added 0.5 per cent. Hong Kong's Hang Seng rose 0.8 per cent.

U.S. markets also seemed to throw off the dispute, as encouraging numbers came in about U.S. employment.

U.S. ready to target $550B

On Thursday, Trump said higher tariffs on an additional $16 billion in Chinese goods were set to take effect in two weeks. He spoke to reporters who flew with him to Montana for a campaign rally.

After that, the hostilities could intensify: Trump said the U.S. is ready to target an additional $200 billion in Chinese imports — and then $300 billion more — if Beijing does not yield to U.S. demands and continues to retaliate.

A truck driver waits for his load at the port in Savannah, Ga. The U.S. has imposed 25 per cent duties on $34 billion US in Chinese products. (Stephen B. Morton/Associated Press)

That would bring the total of targeted Chinese goods to potentially $550 billion — more than the $506 billion in goods that China shipped to the United States last year.

The Trump administration contends China has deployed predatory tactics in a push to overtake U.S. technological dominance. These tactics include cyber-theft and requiring American companies to hand over technology in exchange for access to China's market.

'No winners in a trade war'

Chinese officials reject accusations of theft and say no foreign company is obligated to share technology. But rules on auto manufacturing and other industries require companies to work through state-owned partners, which forces them to share know-how with potential competitors.

The Commerce Ministry said Trump "ignited the biggest trade war in economic history."

"The United States has blatantly violated WTO rules," said Lu, the Foreign Ministry spokesperson. "Any unilateral pressure will be futile."

Washington has strained relations with potential allies in its dispute with Beijing by raising import duties on steel, aluminum and autos from Europe, Canada, Mexico and Japan.

Trump's confrontational outlook applies to other trading partners as well as China, said Tai Hui, chief strategist for JP Morgan Asset Management, in a report.

"This is a potential concern for the outlook of corporate investment and consumption around world," Hui said.

The official newspaper China Daily accused the Trump administration of "behaving like a gang of hoodlums" who could do damage to the global economy unless other countries stop them.

"There should be no doubting Beijing's resolve," the newspaper said.

A worker sorts dried seafood for export at a factory in Lianyungang in China's eastern Jiangsu province. China said it was 'forced to take necessary countermeasures' after Washington imposed tariffs on billions of dollars in Chinese imports. (AFP/Getty Images)

The American Chamber of Commerce in China appealed to both sides to negotiate a settlement.

"There are no winners in a trade war," said the chamber's chairman, William Zarit, in a statement. It said American companies want fairer treatment but will be hurt by U.S.-Chinese tensions.

"We urge the two governments to come back to the negotiation table," said Zarit.

U.S. soybean farmers have been particularly concerned. The price of soybeans has plunged 17 per cent in the past month on tariff fears.

John Heisdorffer, a soybean grower from Keota, Iowa, and president of American Soybean Association, warned that the United States' competitive position in the world soybean market could be permanently damaged, with the possibility that Brazil and others could gain market share.

"If we lose that, my son will spend the rest of his lifetime trying to get that back," he said. "We just ask the administration to back away from using tariffs to achieve U.S. trade policy goals. The scorched-earth approach is really going to cost us."