© REUTERSDefence Secretary Gavin Williamson accused of blowing access to Chinese markets worth billions
Chinese deputy PM Hu Chunhua was due to hold trade talks with Philip Hammond this weekend.
But he dramatically cancelled the meeting on Monday afternoon - just hours after the Defence Secretary publicly lashed China's military ambitions.
In a fiery speech, Mr Williamson said Britain must be prepared to boost our "lethality" as he threatened to deploy a British aircraft carrier to China's backyard.
A source told The Sun: "There is huge anger across Cabinet. Gavin was partially inciting a war - the team knew China wouldn't be happy."
China had been expected to lift their bans on British poultry and cosmetics which have not been tested on animals.
The agreements would have opened up access to markets worth an estimated £10.2billion over five years.
Mr Hammond was expected to return to Britain on Sunday triumphantly clutching the two Memorandums of Understandings with China.
The deals would have been a desperately-needed boost for the Government, which is scrambling to drum up trade as Brexit looms.
But Mr Chunhua pulled out of the talks at the eleventh hour.
Instead, China offered up only junior officials - ending hopes any agreements would be reached.
The Sun understands that officials have embarked on a frantic round of diplomacy to try to get the talks back on track for this weekend.
A defence source told The Sun that Mr Williamson's speech was shown to No10 and the Treasury before he gave it.
THe Chinese empires isn't going to keep playing these Western empire games much longer... .Xi has to know how this pattern repeats.... does he or any of these people know the game is up?