ISTANBUL

US Vice President JD Vance said Sunday that Washington holds more leverage than China in escalating trade tensions, while expressing hope Beijing will choose a “reasonable” path.

"If they respond in a highly aggressive manner, I guarantee you, the president of the United States has far more cards than the People's Republic of China," Vance told Fox News.

The comments follow US President Donald Trump's Friday threat to impose 100% tariffs on Chinese goods and restrict critical software exports after Beijing announced controls on the exports of rare earth minerals.

Vance acknowledged the situation requires careful handling. "It's going to be a delicate dance, and a lot of it is going to depend on how the Chinese respond," he said.

"We're going to find out a lot in the weeks to come about whether China wants to start a trade war with us, or whether they actually want to be reasonable. I hope they choose the path of reason," Vance added.

Vance says he hopes US doesn’t have to use its leverage

"What the United States has is we have a lot of leverage, and my hope, and I know the president's hope, is that we don't have to use that leverage," said Vance.

He said Trump "appreciates the friendship that he's developed” with Chinese President Xi Jinping and they "have a good relationship," but claimed everyone was "shocked" by China's actions.

Vance emphasized that Washington seeks positive relations with China "but not if the Chinese go down this pathway of cutting off the entire world from access to some of the goods that they produce."

Beijing said Sunday it is "not afraid of" a trade war after Trump's threats. China's position on a trade war is consistent, a Commerce Ministry spokesperson said, namely: "We do not want it, but we are not afraid of it.”

Trump announced the new 100% tariffs would take effect on Nov. 1 "over and above any tariff that they are currently paying," along with export controls on critical software.

The threat of new tariffs sent US stock markets plunging on Friday, following upheaval in the markets from Trump’s announcement in April of new worldwide tariffs.

China expanded rare earth export restrictions Thursday, imposing limits on processing and manufacturing technologies and prohibiting cooperation with foreign companies without prior government authorization.