"The ECFA is a political and economic asset that the KMT has fought to give the Taiwan people. How could we let a pro-Taiwanese Independence party plunder or ruin it?"
China has warned the US president that it will harm ties between the two countries if he meets the Dalai Lama.
Chinese Communist Party official Zhu Weiqun said there would be "corresponding action" if the meeting went ahead.
The White House has indicated that Barack Obama intends to meet the head of Tibetans in exile.
Mr Zhu's comments follow talks between China and the Dalai Lama's representatives in China.
The talks yielded little progress, with both sides reiterating positions that were "sharply divided".
No compromise
Mr Zhu talked at length about China's view on a possible meeting between Mr Obama and the 1989 Nobel Peace Prize winner.
He said: "It will seriously undermine the foundations of Sino-US political relations."
Mr Zhu, of the Chinese Communist Party's United Front Work Department, said China would retaliate.
 |  It will seriously undermine the foundations of Sino-US political relations  Zhu Weiqun on possible Obama-Dalai Lama meeting |
"If [the meeting] does happen we will take corresponding action to make relevant countries see their mistakes," he said.
These comments come straight after a disagreement between China and the US about the sale of American military equipment worth $6.4bn to Taiwan, an island China considers its own.
Mr Zhu was speaking at a press conference to discuss the recent five-day visit to China by the Dalai Lama's representatives.
This is the ninth time the two sides have met since 2002, but there is little common ground between them, as the Communist Party official acknowledged.
"The positions of the two sides are sharply divided," he said.
"We have become accustomed to this - this has become a norm rather than an exception."
According to China, at this latest round of meetings the Tibetans again reiterated their hopes for the introduction of greater autonomy in the Himalayan region.
Mr Zhu said there was no possibility of the "slightest compromise" on the issue of sovereignty in Tibet.
He also attacked the Dalai Lama, who he said was a troublemaker.
The Dalai Lama fled Tibet in 1959 after a failed uprising against Chinese rule.
"He should make a thorough self-examination of his words and deeds and radically correct his political positions if he really expects results of contact and talks," said the Chinese official.
The talks between China and the Tibetans in exile, based in Dharamsala in India, follow an important conference held last month by Chinese leaders to review their Tibet policies.
The meeting established China's goal of bringing about "leap-forward development" and long-term security in the region, which saw major unrest in March 2008.
Despite riots and demonstrations directed against Chinese rule, Beijing believes its policies in Tibet are correct.
"The conference especially demonstrated the brilliant achievements in Tibet in the new century," said Mr Zhu.
