China weighs in on new economic envoy to US

Beijing plans to replace Deputy Prime Minister Liu He as its chief economic envoy to Washington, officials with knowledge of the matter say, a move that officials in the Biden administration say will indicate the depth of interest in the China for economic cooperation.

In this scenario, these officials said, Mr. Liu, who has spent decades working on economic issues, would be replaced by Hu Chunhua, a young deputy prime minister who made his mark overseeing the troubled region of Tibet and by leading the coastal province of Guangdong but which has little experience in US-China relations.

The deliberation is part of a larger staff reshuffle as China recalibrates its approach to the new US administration. A trade truce struck by the two sides early last year led Beijing to shift its economic focus from tariffs to easing sanctions against Chinese companies, especially telecommunications giant Huawei Technologies Co.

Vice Premier Hu Chunhua, who currently oversees the Ministry of Commerce, may succeed Liu.


carlos garcia rawlins / Reuters

No final personnel decisions have been made, officials said, who added that there were also reasons to keep Mr. Liu in this role. China’s Foreign Ministry referred questions to China’s Ministry of Commerce, which oversees the trade. He did not respond to requests for comment.

Even if replaced as Beijing’s main economic interlocutor with Washington, Liu would still have significant responsibility, officials said, including overseeing China’s financial sector at a time of heightened debt and risk of default.

But he is set to turn 70 early next year, which puts him beyond the traditional retirement age for Chinese leaders. The leadership of the Communist Party will meet to select new members of its leadership team at the end of next year.

Mr. Liu is a childhood friend of Chinese leader Xi Jinping, who chose him to lead negotiations with the Trump administration as the two sides wrangled over trade.

Mr. Liu’s close personal ties with Xi gave him the power to negotiate last year’s “phase one” trade deal with the United States, which facilitated relations between the two sides. . But it also drew criticism in the country for making trade concessions without causing the United States to significantly reduce tariffs.

Liu He negotiated phase 1 trade deal with the United States last year


erik s. lesser / EPA / Shutterstock

Mr. Hu, 58, is considered in Beijing as a candidate for the Politburo Standing Committee, the pinnacle of power in the Communist Party. He currently oversees the Commerce Department, which makes him a natural candidate to lead economic talks with the United States – although neither Washington nor Beijing appear interested in negotiating a follow-up trade deal.

Instead, economic relations between the two countries appear to be at a standstill as disagreements deepen on issues ranging from global security and technology to human rights.

On Wednesday, officials from the two countries clashed with China’s massive incarceration of Uyghurs and other minorities in its Xinjiang region. The United States condemned what it declared to be China’s crimes against humanity and genocide in Xinjiang at a special UN meeting called with European allies. China called the meeting for political purposes and highlighted what it described as human rights violations by the United States in Iraq and Syria.

As part of the phase 1 trade agreement between the United States and China, the two countries have agreed to periodic high-level bilateral reviews of the agreement, led by the United States trade representative and “a vice-president. Prime Minister designate ”of China.

So far, however, the talks have only involved lower-level officials. In recent days, Terrence McCartin, deputy US trade representative for Chinese affairs, spoke with a deputy director general of the Chinese Ministry of Finance for one of these “check-in” sessions, according to a person in the know. of the discussion.

While there are tensions between the United States and China over trade and technology, climate change is one area the couple could work on together. Gerald F. Seib of the WSJ explains why this could also lead to competition for global leadership. Photo illustration: Ksenia Shaikhutdinova

The U.S. Trade Representative’s office did not immediately respond to requests for comment on the recent talks.

In Washington, senior officials are closely monitoring any personnel changes to indicate whether Beijing will pursue a more aggressive approach towards the United States. So far, they say, the signs are concerning.

In a planned move, Beijing is set to replace its longtime ambassador in Washington, the elegant Cui Tiankai, with Qin Gang, a seasoned diplomat considered by some in the Biden administration to be a hawk. Mr. Cui has built relationships in the US capital, including with Jared Kushner, son-in-law of former President Donald Trump and former White House senior adviser, and Kurt Campbell, the Biden administration’s coordinator for China. Mr. Qin, on the other hand, did not serve in Washington.

Beijing has meanwhile appointed Liu Xiaoming, a diplomat known as an asserted “wolf warrior”, to be its new negotiator in North Korea, a critical position from the point of view of the United States, which has looked to China for assistance. play a key role in the negotiation. with Pyongyang and its pursuit of nuclear weapons.

At the same time, Chinese Vice President Wang Qishan, who has built relationships with influential Americans since the late 1990s and has advised Xi on US policy, is increasingly sidelined, according to sources close to the situation. He no longer meets with American business leaders frequently, and a former senior employee of Mr. Wang while leading Mr. Xi’s bribery campaign was recently arrested for bribery.

The debate within Beijing over Liu He’s role also points to changes in how Beijing views its relationship with the United States. Mr. Liu has a reputation as a market reformer and years of experience dealing with American politicians, academics and business leaders.

Now that China has resisted the trade battle and its trade surplus with the United States and the world is only widening, Beijing’s top leaders are considering installing a new man-point on trade and economic relations. with Washington.

Beijing is wondering who is pulling the levers of power in Washington over Chinese issues, people familiar with the situation say. While National Security Advisor Jake Sullivan and Secretary of State Antony Blinken have taken the lead so far, even US officials expect Treasury Secretary Janet Yellen and other economic officials to play. also an important role.

Mr. Hu had spent much of his political career in Tibet, helping to curb the political independence movement after becoming the region’s deputy party secretary in 2003.

Most recently, he was the top official in China’s wealthy southern manufacturing province, Guangdong, and in 2018, Hu was promoted to one of China’s four vice-premiers in the sides of Mr. Liu, although he is more than a decade younger. This has led to speculation in political circles that he would be competing to succeed Xi in 2022, although the Chinese leader is now expected to continue for a third term.

More recently, Hu has sought a higher profile and has spoken frequently with US companies operating in China, according to company representatives.

During these meetings, Hu often spent hours listening to American business executives voice their concerns, from trade disputes to concerns about how a new investment law might be enforced. On numerous occasions, the officials said, Hu pledged a more liberal business environment and encouraged foreign companies to invest more in China.

US-China relations

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Write to Lingling Wei at [email protected] and Bob Davis at [email protected]

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