Senior U.S. official to visit Taiwan this weekend amid China concerns

WASHINGTON (Reuters) - U.S. Undersecretary for Economic Affairs Keith Krach will visit Taiwan for a memorial service for former Taiwanese President Lee Teng-hui on Saturday, the U.S. State Department said, a move likely to anger Beijing as U.S.-China ties are at their lowest ebb in decades.

Wednesday’s announcement of the trip had been widely expected after the senior U.S. diplomat for East Asia, David Stilwell, said last month that Washington would bolster ties with Taiwan by establishing a new bilateral economic dialogue. He said subsequently that Krach would lead it.

The State Department statement made no mention of the dialogue, however, and analysts said this appeared to reflect disagreement in the U.S. administration as to how to proceed on economic issues with Taiwan and caution about going too far in upsetting Beijing.

On Monday, China’s Foreign Ministry spokesman Wang Wenbin was asked about the possibility of a visit by Krach to Taipei and said China firmly opposed official exchanges between the United States and Taiwan, and warned of serious damage to China-U.S. relations.

Taiwan’s government said Krach’s visit would start on Thursday, likewise making no direct mention of economic talks. The presidential office said Krach is due to meet President Tsai Ing-wen on Friday evening.

U.S. Health Secretary Alex Azar visited Taiwan last month, the highest level U.S. official to travel to the island since Washington broke off diplomatic ties with Taipei in favor of Beijing in 1979.

Taiwan experts said they believed Krach would be the most senior State Department official to make a public visit since that same year.

“The United States honors President Lee’s legacy by continuing our strong bonds with Taiwan and its vibrant democracy through shared political and economic values,” a State Department statement said in announcing Krach’s trip.

Lee Teng-hui, who died in July aged 97, was dubbed “Mr. Democracy” for burying autocratic rule in Taiwan in favor of freewheeling pluralism. He thrived on defying China’s drive to absorb an island it regards as a wayward province.

Derek Scissors, a China expert at the conservative American Enterprise Institute think tank, said the decision for Krach to attend the memorial allowed for further discussion on a formal structure for economic talks.

“While China will oppose any visit by American officials to Taiwan, the U.S. chose to represent this as a one-time event,” he said. “That will be seen in a better light by Beijing than starting a series of visits.”

The United States, like most countries, has official relations with Beijing, not Taiwan, but Washington is bound by law to help Taiwan defend itself and is its main arms supplier.

Reuters reported earlier that Washington plans to sell as many as seven major weapons systems, including mines, cruise missiles and drones to Taiwan, as President Donald Trump ramps up pressure on China ahead of his November re-election bid.

Douglas Paal, a former U.S. representative in Taiwan, said Beijing would want to avoid making the Chinese relationship more prominent than it already was in the U.S. election, while Trump would not want to damage his Phase 1 trade deal with China.

“I don’t think this visit crosses the brightly lit red line that would force China to show a strong reaction,” he said. “So it is sucking it up, offering only ritual objections.

“Moreover, Beijing recognizes that Trump will not authorize his subordinates to get really bold with China, perhaps for fear of losing Chinese agricultural purchases in the Midwest before the election.”

Taiwan has long sought a free trade agreement with the United States but Washington wants to rebalance a big trade deficit and remove barriers for U.S. agricultural products.

Tsai announced last month that Taiwan would allow in U.S. pork containing ractopamine, an additive that enhances leanness, and U.S. beef more than 30 months old.

Reporting by David Brunnstrom and Tim Ahmann; Additional reporting by Ben Blanchard in Taipei; Editing by Mary Milliken, Cynthia Osterman and Tom Hogue