China threatens Taiwan with more trade measures after denouncing president’s speech

China is studying further trade measures against Taiwan, China’s Ministry of Commerce said on Saturday, two days after Beijing denounced a speech by Taiwan President Lai Ching-te.

The Chinese ministry said in a statement on its website that the Democratic Progressive Party, Taiwan’s ruling party, had not taken any practical measures to lift “trade restrictions” on China.

“At present, relevant (Chinese government) departments are studying further measures based on the conclusions of the investigation into trade barriers from Taiwan” against China, it added.

Taiwan’s China policy making Mainland Affairs Council said it regretted and “strongly protested” the move.

“Blatant economic coercion will only arouse the resentment of the Taiwanese people and cause the distance between the two sides of the Taiwan Strait to grow wider and wider,” it said in a statement.

China, which views democratically governed Taiwan as its own territory, detests Lai as a “separatist.” Lai and his government reject Beijing’s sovereignty claims, saying only Taiwan’s people can decide their future.

On Thursday at his keynote national day speech, Lai said the People’s Republic of China had no right to represent Taiwan, but that the island was willing to work with Beijing to combat challenges like climate change, striking both a firm and conciliatory tone, drawing anger from China.

The Saturday announcement from China’s commerce ministry could portend tariffs or other forms of economic pressure against the island in the near future.

China’s Taiwan Affairs Office, which on Thursday said that Lai’s speech promoted “separatist ideas” and incited confrontation, responded to the announcement by saying the fundamental reason behind the trade dispute was the “DPP authorities’ stubborn adherence to the stance of ‘Taiwan independence’.”

“The political basis makes it difficult for cross-Strait trade disputes to be resolved through negotiation,” it added.

In May, China reinstated tariffs on 134 items it imports from Taiwan, after Beijing’s finance ministry said it would suspend concessions on the items under a trade deal because Taiwan had not reciprocated.

The Cross-Strait Economic Cooperation Framework Agreement (ECFA) between China and Taiwan was initially signed in 2010 and Taiwanese officials had previously told Reuters that China was likely to pressure Lai by ending some of the preferential trading terms within it.