Here is what Beijing says about it:

What has been China’s reaction so far?

China has reiterated its threat to take “necessary countermeasures to defend its legitimate rights and interests” following Trump’s decision to impose 10% tariffs on China for allegedly doing too little to stem the production of precursor chemicals for fentanyl.

The Foreign Ministry statement issued Sunday did not mention any specific retaliatory measures, but said “China calls on the United States to correct its wrongdoings, maintain the hard-won positive dynamics in the counternarcotics cooperation, and promote a steady, sound and sustainable development of China-U.S. relationship.”

China says the U.S. action violates World Trade Organization rules and has vowed to bring a case before the body that governs global commerce.

The Ministry of Public Security on Sunday made near identical charges and the Commerce Ministry also issued a closely worded statement.

Who does China say is to blame?

Trump accuses China of allowing the production of fentanyl, which is then made into tablets in Mexico and smuggled into and distributed throughout the U.S., which records some 70,000 overdose deaths from the drug annually.

China says the U.S. must hold itself to account instead of “threatening other countries with arbitrary tariff hikes,” the Foreign Ministry said. “The United States needs to view and solve its own fentanyl issue in an objective and rational way … (China is) one of the world’s toughest countries on counternarcotics both in terms of policy and its implementation.”

Experts say China executes an unknown number of people each year for smuggling drugs, but domestic drug use is relatively low.

The Ministry of Public Security statement said the U.S. has not reported any fentanyl precursor seizures originating in China since Beijing began to take legal action.

What other issues may be having an impact on the dispute?

China’s enormous trade deficit with the U.S., which reached nearly $1 trillion last year, has been a constant target of Trump’s complaints. Tariffs would make Chinese goods more expensive for U.S. consumers, who will ultimately have to pay a significant part of the cost of importing everything from toys to clothing.

China’s vital export market could be impacted if U.S. consumers decide to “buy American.” The Chinese domestic economy has failed to respond to a range of government-backed stimuli, while foreign infrastructure projects and other major government initiatives that add to the country’s already high public debt threaten more economic stagnation.

That is already starting to derail Chinese President Xi Jinping’s push to overtake the U.S. in key economic and political indicators, threatening his ultimate ambition to conquer the island republic of Taiwan and assert Chinese primacy in the Indo-Pacific region.

Stopping illegal immigration has also been one of Trump’s core political messages, and was named in tariff actions against U.S. neighbors Mexico and Canada. Illegal arrivals from China are considered a fraction of such numbers, but Trump has put virtually every country on notice that he will hold them accountable for their nationals who enter the U.S. outside the law.