At this stage the tariffs still represent a small percentage of overall trade and typically when economic sanctions like this are taken they are a lead in to negotiation. But the consequences of an economic cold war could be very bad indeed.
If the government wants to leave China's economy in a significantly stronger place at the end of 2018 it needs to invest further in supporting innovation and in protecting intellectual property.
In KPMG's 2017 report on world innovation centers Shanghai was rated as the global city most likely to surpass Silicon Valley as an innovation hub, ahead of New York. This is due to the strength of the ecosystem that Shanghai has built for innovation.
Understanding the risks that China's economy faces we will see a continuing shift in policy towards 'quality' economic growth and less emphasis on chasing GDP numbers.
China's World Internet Congress offers a huge chance for Chinese companies to showcase the technology that they have been developing and implementing over the last 12 months and to illustrate just how far internet giants like Alibaba and Tencent have gone in terms of turning China into the world's most innovate internet economy.
Importantly, the different tones set by the US and China at the APEC forum are not simply a war of words but a real indicator of shifting trade-winds and spheres of influence in Asia.