The Chinese government is in a confident mood at the moment. But by threatening to impose sanctions on US businesses that are involved in a $6.4bn arms deal with Taiwan, China is in danger of making a serious and counter- productive mistake.

Relations between the US and China are at a very delicate stage. The good feelings generated by US president Barack Obama's visit to China last November have quickly dissipated. In their place have come a series of disputes: about Google and cybersecurity, about climate change, about currency regimes, about Iran – and now about Taiwan.

Both sides are wearily familiar with each other's position on Taiwan. But China's decision to threaten sanctions over the arms-sales package represents an escalation of Beijing's normal fierce verbal condemnation.