Official media Wednesday said the State Council has named Mr Li a vice-minister of foreign affairs.

Mr Li, who has been the ambassador in Washington for three years, is expected to continue to play a key role in shaping China's policies towards the US in his new posting.

The career diplomat was credited for having steered Sino-US relations over a difficult three-year period.

During his time as ambassador, bilateral ties faced severe tests including the bombing of the Chinese Embassy in Belgrade in May last year during the US-led Nato air-strike against Yugoslavia, and the accusations of Chinese "thefts" of US nuclear secrets.

Although there is no report directly name his successor, it said Yang Jiechi had been relieved of his duties as a vice-minister of foreign affairs. The announcement indirectly confirmed a report by the Los Angeles Times last week that Mr Yang, 50, would become the next ambassador to the US.

The Los Angeles Times report said Mr Yang's appointment could be significant in helping to cement ties between China and the United States.

The report also confirmed that former Guangdong vice-governor Wang Qishan has become the new minister of the State Commission for Restructuring Economy. Incumbent Liu Zhongli is expected to retire.

(China Daily 12/28/2000)