European markets open higher as China vows to fight Trump's tariffs.

Live from the UK, this is the Marketplace Morning Report from the BBC World Service.

Hello, I'm Nick Kareishi in for Leanna Byrne.

China has reacted strongly to President Trump's threat to raise tariffs on its imports to more than 100%, saying it would fight until the end.

A spokesman for the foreign ministry in Beijing, Lin Jian, said China would not give in to what he called blackmail.

I want to stress once again that trade wars, tariff wars have no winners, and protectionism has no way out.

If the US ignores the interests of the two countries and the international community

and insists on a tariff war and a trade war, China will fight it to the end.

China's Foreign Ministry spokesman Lin Jian.

So where does all this go from here?

I've been getting the thoughts of Andy Shea, an independent economist in

Shanghai, who used to work for Morgan Stanley and the World Bank. Hi, Andy. Hi, Nick. So how do you

think China is going to respond to this latest threat? I think China will respond in kind. It'll

be more dangerous to back down, because if Trump can't get away with it, he will come after you again.

An exact tip-for-tack, do you think?

Yes, I think so. If it's 50% tomorrow, China will do 50%.

Who seems to have more to lose in this increasing push towards what seems to be a global trade war?

Obviously, everybody loses, but I think China can deal with it. The exports to the

United States, about 2.6% of GDP in value. It's not insignificant, but the country will get over it.

For Americans, because the debt levels are so high, if the economy falters, there will be a lot of ramifications, I believe.

Do you think China is going to compromise, given the fact that neither country seems to want to blink first?

Oh, no, China will not. If Trump wants to take China to hell, China will take him there and some.

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