China takes action on key US fentanyl demands

(Reuters) - China has taken a series of actions in the past week on counter-narcotics, in a sign of cooperation with U.S. demands for stronger action on the synthetic opioid fentanyl, a key irritant in the bilateral relationship.

U.S. President Donald Trump imposed 20% tariffs on Chinese imports in February over Beijing's alleged failure to curb the flow of precursor chemicals for fentanyl, which has caused nearly 450,000 U.S. overdose deaths. Those tariffs have remained in effect despite a fragile trade truce reached in Geneva in May.

Beijing has defended its drug control record and accused Washington of using fentanyl to "blackmail" China. Both sides were in a stalemate over the issue for months, despite China sending its vice public security minister to the Geneva talks.

China has balked at some of Washington's demands which include publicising the crackdown on precursors on the front page of the Communist Party mouthpiece People's Daily, educating Party members and tightening regulation of specific chemicals, among other actions.

On Thursday, China's State Security Ministry accused a "certain country" of "deliberately launching unwarranted attacks on China over the fentanyl issue", in a veiled swipe at the U.S.

But last Friday, Beijing added two precursors to a list of controlled chemicals starting July 20, according to a government statement. The chemicals, 4-piperidone and 1-boc-4-piperidone, were "considered fundamental to resolving the fentanyl issue," raising hopes that the 20% tariffs could be eventually lifted, according to a source familiar with U.S. government thinking.

The move came after U.S. Ambassador David Perdue had a rare meeting with China's Minister of Public Security Wang Xiaohong last Thursday in Beijing, at which Wang expressed willingness to work with Washington on drug control, according to a Chinese statement.

China's Foreign Ministry said the action on precursors was an "independent measure" taken by Beijing in line with the UN Drug Convention and "demonstrates China's attitude of actively participating in global drug governance."

Working-level conversations on fentanyl remain ongoing and Trump and Chinese President Xi Jinping discussed the topic in a June 5 phone call.

Chinese immigration officials seized 2.42 tons of drugs and arrested 262 suspects for drug smuggling so far this year, state media reported Thursday, as Beijing vowed to crack down on drug trafficking and "intensify anti-drug propaganda" in border areas and ports.

In addition, Chinese officials announced on Wednesday they had prosecuted more than 1,300 people and arrested over 700 more nationwide for drug-related money laundering offences between January and May this year, a 2.1% year-on-year increase.

Beijing will "cut off the criminal interest chain and destroy the economic foundation of drug crimes," Miao Shengming, a senior official at the Supreme People's Procuratorate said during a press conference.

On Monday, a court in the southeastern province of Fujian handed a suspended death sentence to former drug control official Liu Yuejin for bribery, state media reported.

Liu, a former director of the Ministry of Public Security's narcotics control bureau, was convicted of illegally receiving bribes worth over 121 million yuan ($17 million) between 1992 and 2020.

The U.S. Embassy in Beijing did not respond to a request for comment.

The Chinese government statements did not mention the U.S.

Chinese scholars acknowledge that fentanyl's central position in the U.S.-China trade war comes with a lot of political baggage for Beijing.

"The U.S. views the fentanyl issue as a sign of poor governance on China's part and has exerted pressure on China as a result, politicising the issue of drug control," said Liu Weidong, a U.S.-China expert at the Chinese Academy of Social Sciences.

"This context is certain to influence China's approach to addressing the fentanyl issue."

($1 = 7.1764 Chinese yuan renminbi)

(Reporting by Laurie Chen in Beijing; Additional reporting by Brenda Goh in Shanghai; Editing by Lincoln Feast.)