China's state media warned U.S. President-elect Donald Trump his pledge to slap additional tariffs on Chinese goods over fentanyl flows could drag the world's top two economies into a mutually destructive tariff war.

Mexico said it would slap tit-for-tat tariffs on the US, while China said Trump's finger-pointing "runs completely counter to facts".

The president-elect’s threat to hit Canada, Mexico and China with new tariffs is already rocking business and diplomatic relationships and could topple the trade pacts he signed in his first term.

Leaders in Mexico and Canada responded to the president-elect’s proposed new tariffs. Observers said the plan might just be the first step in negotiations.

If the president-elect follows through, consumers and businesses are likely to see prices rise on everything from fresh fruit to electronics