China Elevates ‘Good Cop’ on Trade to Counter Trump Barbs

  • Zhang Xiangchen named new Chinese ambassador to the WTO
  • Zhang represents good cop in two-pronged effort on trade

It was an unusual move for a Chinese official. Appearing before 400 executives and officials at a steak dinner at a hotel in Beijing, Zhang Xiangchen set aside his notes and began speaking off the cuff in English.

The corporate chiefs had gathered on Dec. 9 to hear the Chinese government’s first major remarks to foreign businesses since Donald Trump’s election win the prior month. Trump’s victory was prompting fears of a trade war, and Zhang’s speech came just days after his surprise call with Taiwan’s president briefly threw decades of U.S. policy into question.

Zhang Xiangchen

Photographer: Imaginechina

Speaking at the China Appreciation Dinner hosted by the American Chamber of Commerce, Zhang focused his remarks on his ”old friends” in the audience and his personal conviction a trade war could be averted. He told the audience to look for Vice Premier Wang Yang to make an official comment.

Named last week as ambassador to the World Trade Organization, Zhang is regarded by some international diplomats as an official to watch in Xi Jinping’s administration. His role is potentially more important given a protectionist president in the White House who has publicly questioned whether the WTO works, and as China learns to leverage its economic clout against its neighbors.

“I haven’t seen a Chinese official give a speech like that in perhaps 15 years,” said James McGregor, a former AmCham chairman who has lived in China since 1990. “He talked like he was personal friends with half the people in the room, but you can bet when he gets to Geneva, he’ll be battle ready.”

Muscular Approach

Zhang has 25 years of experience as a bureaucrat, though he is not widely known outside trade circles in Geneva. Regarded as open, internationalist and charismatic, Zhang, 51, represents a new public face for China’s trade diplomacy as Xi touts the country’s role as a preserver of the international rules-based order that Trump derides.

But he doesn’t represent the only face. Just as China is deploying a cohort of officials to represent its economic interests abroad, it is also taking a more muscular approach to trade diplomacy that it prefers not to publicize.

Xi used his January speech at the World Economic Forum to liken protectionism to “locking yourself in a dark room.”

In recent months, however, China has mounted an economic campaign against South Korea over a missile shield dispute, squeezed Taiwan’s tourist numbers, and made preparations to retaliate against U.S. companies if Trump sets off a trade war. That makes Zhang perhaps the ultimate good cop in a two-pronged Chinese effort on trade.

‘Very Professional’

"The guy’s a class act. He’s a photographer. He’s a calligrapher. He came top of his class at Beida," said a current U.S. official who asked not to be identified discussing Zhang, referring to the elite Peking University.

“He’s well experienced, very talented,” said He Ning, former director general of the Department of American and Oceanian Affairs at China’s Commerce Ministry and a one-time Zhang colleague.

“He’s probably one of the most impressive Chinese officials I’ve ever seen,” said Jeff Moon, who stepped down as Assistant U.S. Trade Representative for China Affairs in January. In meetings, Zhang “defends Chinese interests vigorously. He was very smart, very professional, he’s urbane. He doesn’t play games.”

Zhang was born in the northern province of Hebei. He joined the Communist Party while studying law at Peking University, among the first generation of senior officials to receive the bulk of their education after the Cultural Revolution.

WTO Entry

Zhang started work in 1992 at what has since become the commerce ministry after a brief period working at a textiles factory. He worked on China’s WTO entry, rising to become China’s Deputy International Trade Representative.

“Zhang represents a new generation,” said Moon who worked as an Asia specialist at the State Department from 1989 to 2009. “Generally those educated after the Cultural Revolution are the most sophisticated,” he said. “There’s a lot less theater, unnecessary rhetoric and ideology.” The Commerce Ministry did not respond to requests for comment on Zhang.

As South Korea’s Lotte Group has recently learned, however, China’s trade tactics can include a big stick.

A closed Lotte store in China’s Jiangsu province on March 7.

Photographer: AFP via Getty Images

After Lotte agreed to sell the Korean government land for a U.S. anti-missile system known as Thaad, Chinese authorities suspended more than half of the stores Lotte operates in China, citing alleged fire safety violations.

While Chinese officials deny targeting the group, there’s been a swathe of moves broadly against South Korea, covering everything from tourists to teddy bears and K-Pop stars. China earlier cut back tourist flows to Taiwan after Trump’s phone call to President Tsai Ing-wen threw the decades-long One-China policy governing Taiwanese affairs into doubt.

It’s not a new approach. During a standoff with China over the Scarborough Shoal in the South China Sea in 2012, China told tourists to avoid unnecessary travel to the Philippines and increased quarantine and inspection of fruit shipped from the country.

Norwegian salmon exports to China plunged after Chinese dissident Liu Xiaobo was awarded the Nobel Peace Prize in 2010. The same year, China stopped giving Japan export licenses for rare earth metals needed for cars and electronics amid tensions over disputed East China Sea islands.

‘We Learn’

These tactics, however, rarely make it to the negotiating table. They are often initiated by customs or financial regulators, quality inspectors or economic planning bodies. When it comes to talks, Zhang and others take a leaf from what China has gleaned from interactions with foreign officials.

“We learn from negotiations, we are being trained by our counterparts,” said He, who served as Minister for Economic and Commercial Affairs at the Chinese Embassy in Washington, DC. “We learned from the U.S.”

Zhang and his cohort have become strong proponents of the WTO. Zhang defended the terms of China’s entry in 2001 and has subsequently written books on China’s relationship with the organization.

Indeed, even before the announcement of his new job, Zhang was gently touting the WTO as a potential tool against Trump.

“I think after Trump takes office, he will be reminded that the U.S. should honor its obligations as a WTO member,” he said at a briefing in Washington on Nov. 23. “As a member of the WTO, China also has the right to ensure its rights as a WTO member.”

— With assistance by Peter Martin, and Keith Zhai

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