Top Chinese Official Plans U.S. Trip to Address Trade Friction

BEIJING — President Xi Jinping of China is sending his top economic policymaker to Washington on Tuesday in a bid to reduce trans-Pacific trade tensions before China’s congress convenes for its annual session.

The trip by Liu He, who joined the Politburo in October and is widely expected to be named China’s vice premier for financial and industrial policy at the congress, comes as Trump administration officials have increased their criticism of Beijing’s trade policies in recent weeks. Liu’s trip was described by a person involved in the planning who spoke on condition of anonymity.

The Commerce Department declared a week ago that U.S. imports of steel and aluminum from China and other countries were a threat to national security, suggesting several ways for President Donald Trump to tax or otherwise restrict such goods.

Trump has considered imposing a “reciprocal tax” on countries, like China, that impose higher tariffs on their imports of U.S. products than the United States levies on theirs.

Liu is expected to lead a sizable delegation to Washington. He would be the second Politburo member to visit the city this month. Yang Jiechi, China’s top diplomat, arrived this month but made little headway at a time when the mood in Washington has shifted toward strong concern about China’s rapid military buildup and record trade surpluses with the United States.

The Chinese government has taken the position that it is not afraid of a trade confrontation with the United States, and that the Chinese market can absorb extra goods if the United States turns them away.

But Xi and his advisers have also tried to preserve the status quo on economic relations with the United States while they focus on domestic issues, like breaking China’s addiction to debt-fueled economic growth.

The choice of Liu to lead the delegation is somewhat surprising, and underscores his growing influence in the Chinese government. Wang Qishan, the powerful leader of Xi’s anti-corruption campaign until his retirement from the Politburo in October, is expected by many experts to be named the country’s vice president during the annual session of China’s congress, which is to begin March 5.

As vice president, Wang would play a significant role in international diplomacy. But the choice of Liu to lead the trip to Washington on Tuesday indicates that he may play a leading role in international economic negotiations. He already runs the Communist Party’s elite policy planning unit for financial issues.

Some experts have recently suggested that Liu may also end up running China’s central bank after the imminent retirement of its governor, Zhou Xiaochuan, who turns 70 this year.

“If international reputation and international confidence are important criteria, Liu He may well get the appointment — simultaneous appointment as vice premier and also governor” of the central bank, said Victor Shih, an associate professor at the University of California, San Diego, who specializes in China’s financial policy factions.

But the Chinese Communist Party is also planning a Third Plenum in the coming weeks, a rare gathering of top leaders that would review ways to restructure the government. It could include shrinking the broad policy role played by the central bank and transferring some of those responsibilities to an interagency committee of regulators that Liu is also set to lead.

If the central bank loses some of its powers, the top job may become less important. In that case, Zhou’s deputy, Yi Gang, may be promoted to the governorship even though he would not otherwise have the political seniority to take it, people familiar with the discussions said.