China is threatening to impose harsh trade sanctions on the United States companies involved in a deal to sell more than six billion dollars worth of arms to Taiwan. Beijing says it will impose the sanctions unless the US government stops the deal.

China is also freezing military relations with the US. This means there can be no progress in talks on such subjects as defence, security and non-proliferation. The Chinese Ministry of Defence says the weapons deal contradicts statements made by US President Barack Obama during his visit to China last November.

The sale, which includes over 100 Patriot rockets, 60 Black Hawk helicopters, mine-hunting ships and communications technology, forms part of a deal struck by the administration of President George Bush in 2001. Taiwan's President Ma Ying-jeou, who favours better relations with China, says the island must stay on guard given the mainland's sharp rise in military spending. China still sees the island as a renegade province.

Photo of Patriot rocket laucner by delta16v (flickr)