China has warned Donald Trump a new trade war “will leave no party unscathed” as the incoming US president’s new tariff threats provoke an angry reaction.

The response by the world’s second-largest economy to Mr Trump’s promise of additional 10% tariffs on all goods from China into the US, came via state media.

“There are no winners in tariff wars. If the US continues to politicise economic and trade issues by weaponising tariffs, it will leave no party unscathed,” the China Daily said in an editorial.

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Mr Trump announced late on Monday that he would also target neighbours Mexico and Canada.

He pledged 25% tariffs on goods coming from both nations due to excessive migration.

Mexico and China, however, are also in his sights for another reason.

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Mr Trump has said both are responsible for “attacking” the US with fentanyl – a drug widely blamed for the opioid crisis in the country that has seen more than 100,000 people die from overdoses alone in recent years.

China, his camp has argued, is the dominant source of chemical precursors used by Mexican cartels to produce the deadly drug.

The China Daily editorial continued: “The excuse the president-elect has given to justify his threat of additional tariffs on imports from China is farfetched.

“The world sees clearly that the root cause of the fentanyl crisis in the US lies with the US itself.”

Mr Trump wants both Mexico and China to clamp down on the drugs.

Mexico has long been in his sights over migration, with the volume of illegal border crossings prompting a crackdown during his first term in office.

That did, however, fall short of his 2016 threat of a “big, beautiful” border wall though the existing barrier was extended and bolstered in places.

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This is a big deal for both Canada and Mexico especially.

More than 83% of exports from Mexico went to the US in 2023 and 75% of Canadian exports go to the country.

Mexico has pledged to react to any US tariffs by responding in kind.

Canada’s government has spoken of working together but provincial leaders have voiced anger and shock.

Ontario’s premier, Doug Ford, expected retaliation against its closest trading partner.

He said of Mr Trump’s threat: “I found his comments unfair. I found them insulting. It’s like a family member stabbing you right in the heart.”

If tariffs were to be implemented, as Mr Trump has threatened, the aim would be to hurt exports in each of the countries’ targeted in a bid to shrink the US trade deficit.

The country imports far more than it sends abroad.

However, by raising the cost of imported goods, Mr Trump would risk raising US inflation; the pace of price increases in his own domestic economy as the cost is passed on down supply chains to consumers.

Analysis by Goldman Sachs estimated they would raise consumer prices inflation by 1%, if carried through.

They would also hurt profit margins for US companies, while raising the threat of retaliatory tariffs by other countries, the US bank projected.

The prospect of a trade war has not spooked financial markets, with European and Asian equities seeing only limited losses while the broad S&P 500 on Wall Street is at record levels.

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However, the spectre of a wider Trump-led crackdown on imports has been felt elsewhere, with shares of carmakers coming under pressure on Tuesday.

AJ Bell head of financial analysis, Danni Hewson, wrote: “Proving his love of tariffs wasn’t just a campaign stunt, Trump has pledged he will immediately target Mexico, Canada and China before the last bit of confetti has fallen on his inauguration.”

“For European car makers already struggling to make the shift to EVs profitable, it will have sounded an alarm and shares in Stellantis and Volkswagen both took a hit as did US automakers which import a large number of vehicles from both Canada and Mexico.”

The notion that Donald Trump would hike tariffs is hardly a surprise – it was a plan front and centre of his economic pitch during the election campaign.

If that softened the landing, it still hit hard in the three countries in the frame.

Mexico warned it would cause inflation and job losses in both their countries and Canada’s Prime Minister Justin Trudeau spoke of a relationship that needs a “certain amount of working on”.

It’s the weary assessment of a man who’s seen this movie before.

On the face of it, it’s symptomatic of a muscular economic stance that fits entirely with Donald Trump’s “America First” strategy.

It would have a significant impact, far beyond the countries that Trump has placed in the frame, raising the spectre of trade war and, accordingly, grinding the gears of international trade.

America itself wouldn’t escape consequences.

Canada, Mexico and China are its top three suppliers, shipping more than $1trn of goods to the US in the first nine months of this year alone.

Under the Trump plan, the cut passed on to consumers could cut deep.

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His announcement might amount, merely, to a negotiation tactic – an effort to outsource the problem-solving on his political priorities.

Whatever it is, it creates a sense of diplomatic unease and economic uncertainty.

The alliance between Donald Trump and Elon Musk framed the 2024 election and their bond has only deepened since.

Musk has been a regular fixture at the president-elect’s Florida mansion and the pair have introduced their families.

He has been privy to phone conversations with world leaders, consulted with Trump on his cabinet picks and even hosted him at Space X for the launch of the Starship rocket.

Musk will co-chair the new Department of Government Efficiency, charged with cutting government spending.

But how might the entrepreneur’s other views affect Trump policy?

The cause closest to Musk’s heart is pronatalism, a pro-birth political and personal ideology in which reproduction is the key goal of humanity.

Musk regularly posts on social media with fears about population decline, sometimes bordering on obsession.

“Population collapse is coming… Earth is almost empty of humans,” he wrote recently.

“Instead of teaching fear of pregnancy we should teach fear of childlessness,” he added.

The frequency of these posts has increased in recent months.

Musk has at least 11 children, by three different women. Some of them have spent time with him in recent weeks at Donald Trump’s home.

Few understand the origin of Musk’s pro-birth views better than his own father, Errol Musk – an engineer and businessman from South Africa, who has a strained relationship with his son.

I speak to Errol on a video call from his home near Cape Town.

“Elon doesn’t try to push his opinion across, but he will have an opinion,” he says.

Errol has seven children himself, ranging in age from Elon at 53 to his youngest daughter, who is five. He’s also a pro-natalist.

“We’re not here to enjoy boating or flying or skiing or kite surfing, or something,” he says.

“We are here to continue being here. We should all be worried about declining populations, any country with any industry should be worried.”

Certain countries – like the United States, United Kingdom and Japan – do have ageing populations. But my conversation with Errol also reveals views which veer toward selective breeding.

I ask him about a comment Elon reportedly made to a biographer several years ago. Musk Jr apparently said: “If each successive generation of smart people has fewer kids, then that’s probably bad.”

I ask Errol Musk if that viewpoint is bordering on eugenics.

“I wouldn’t call it eugenics as such, but every nation has practiced a certain form of survival of the fittest.

“One need only go to England and go to the Cheltenham area, the horse breeding area, and say, ‘Look, we’re not going to breed the horses anymore by any form of standard. I’ve got a few old horses I’ve found in Nigeria and we’re going to just mix them with your race horses…’

“They’ll say, no, no, no, no, no,” he added.

A more sanitised version of pro-family politics took centre stage on the campaign trail.

At a rally, Donald Trump declared himself “the father of fertilisation” and vowed to make in-vitro fertilisation (IVF) free for anyone who needs it.

Sky News has been invited inside an IVF clinic in California, the world capital for fertility.

The fertility institute is in the Encino area of Los Angeles and allows patients to choose the eye colour of their baby as well as its gender.

Dr Jeffrey Steinberg was among the first fertility doctors to offer gender selection. He is taking future President Trump’s pledge to offer free IVF at face value.

“Donald Trump for better or for worse, tends to keep his word. And the sort of the pooh-poohing of what he was saying… I think it’s vanished because they’re realising that it’s probably going to happen. So all the fertility centres are gearing up for a huge surge.”

Elon Musk has donated millions of dollars to fertility research.

“Musk is a technocrat,” Dr Steinberg says. “He’s an intellectual genius in multiple areas. And everything he touches seems to turn to gold.

“There’s not much that evolves as quickly as Musk’s technology. But IVF has done that, and I think he’s going to find that very attractive.”

While espousing his pronatalist views, Musk is navigating his own complicated family dynamic.

In the hills outside Austin, Texas, there are rumours he’s bought a multi-million-dollar compound to house some of his children and their mothers together, with his own property 10 minutes away.

Musk denies this is true.

But soon he could be helping to design family policy across the country.