Will Baucus become the next U.S. ambassador to China?

U.S. Senator Max Baucus, a Montana Democrat who has taken a tough stance against some of China's trade practices, will be nominated by President Barack Obama to be the next ambassador to Beijing, according to Senate aides.

Baucus, who announced earlier this year his intention to retire from the Senate at the end of next year, currently chairs the powerful Senate Finance Committee, which oversees tax and trade policy. He was first elected to the Senate in 1978.

Obama's choice of the 72-year-old Baucus to be ambassador to China must be confirmed by the Senate. The chamber is not expected to consider the nomination until early next year.

In July, Baucus and three other influential members of Congress wrote Obama to urge him to press China to halt the theft of intellectual property and to curb practices that discriminate against U.S. companies.

A Democratic official, who asked not to be identified, noted that Baucus led the successful U.S. effort in the 1990s to admit China into the World Trade Organization in 2001 and to begin normal bilateral trade relations with the emerging economy.

The nomination, which has not yet been announced by the White House, comes as relations between the United States and China are straining due to territorial disputes in the East China Sea and South China Sea.

A U.S. guided missile cruiser, USS Cowpens, and a Chinese warship operating near China's only aircraft carrier, the Liaoning, narrowly avoided collision last week in the most significant U.S.-China maritime incident in the South China Sea since 2009.

The near miss followed China's recent announcement of an air defense zone covering disputed islands in the East China Sea, which upset U.S. allies Japan and South Korea.

In other issues, Beijing complains that a U.S. strategic policy shift known as the "pivot to Asia" is an attempt to constrain its growing military and political power in the region, while Washington often accuses China of stealing U.S. government and company secrets via cyber theft.

A senior Senate aide said that under Montana law, Democratic Governor Steve Bullock will appoint a replacement for Baucus if he becomes ambassador to China.

Democrats currently hold 53 Senate seats and two independents regularly vote with them. There are 45 Republicans in the Senate and if Bullock appoints a Democratic replacement, it would not change the balance of power in the chamber.

Spokesmen for Bullock, who is expected to appoint a Democrat, were not available for comment.

Details were not yet available on whether the replacement would serve through 2014. Baucus' Senate seat was already up for election in November 2014.

Whoever is picked by Bullock would have an advantage going into next year's election, assuming that person wanted to seek a full term in the Senate. Republicans have set their sights on the Montana seat in their drive to win majority control of the Senate in the 2014 elections.

As chairman of the Finance Committee, Baucus was a major force in the writing of Obama's landmark healthcare reform law that was enacted in 2010.

In recent years, Baucus also has been working on comprehensive reform of the outdated U.S. tax code. But with Congress so divided over how to revamp the complicated law, odds of passing such major legislation in the 2014 election year were seen as slim.

Assuming Baucus leaves the Senate early next year to move to Beijing, Democratic Senator Ron Wyden of Oregon could become the next chairman of the Finance Committee.

(Additional reporting by Roberta Rampton; Editing by G Crosse, Leslie Adler and Dan Grebler)