U.S.'s China Hawks Drive Hard-Line Policies After -2-

Mr. Mnuchin played a role in getting Mr. Trump to back down and instead approve a deal in which Oracle Corp. and Walmart Inc. would take stakes in a restructured TikTok based in the U.S. The deal is undergoing a security review.

Taiwan is a deepening area of confrontation. During his first three years in office, Mr. Trump had little interest in the island, say national security officials. After Hong Kong, Mr. Pompeo argued Taiwan could be Beijing's next target. China sees Taiwan as lost territory to be recovered, and Beijing has objected to U.S. moves it sees as bolstering Taiwan's resistance and reneging on a pledge to recognize only "one China."

Since August, Mr. Trump approved a rare cabinet-level visit to Taiwan, sending Health and Human Services Secretary Alex Azar, and the two governments have opened a "bilateral economic dialogue" -- something short of formal trade negotiations.

The U.S. also went ahead with sales of cruise missiles, mines and drones to Taiwan, which would be needed to repel any possible attack from China. Beijing flew 18 warplanes across the midline of the narrow waters that separate the mainland and Taiwan, in what Taiwan officials saw as an attempt at intimidation.

Former national security adviser John Bolton, who had long urged tighter relations with Taiwan but made little headway, said he sees greater appetite to challenge China in the new approach: "The bureaucratic dynamic changed," he said. "The opposition has faded."

Write to Bob Davis at [e-mail], Kate O'Keeffe at [e-mail] and Lingling Wei at [e-mail]

(END) Dow Jones Newswires

10-16-20 1305ET