China agreed to buy 70 planes from Boeing Co. in a deal worth up to about $ 5 billion before discounts as US President George W. Bush prepared to lobby Beijing this weekend to slash a ballooning trade deficit. The deal, confirmed by a US official, is good news for Bush as he starts a visit to Beijing on Saturday to cajole Chinese President Hu Jintao into helping reduce a trade deficit that could top $ 200 billion this year. Asia has emerged as a battleground in Boeing’s effort to regain market share from Airbus SAS, which this year inked a similar contract to sell 10 jets to China. Airbus is controlled by European aerospace company EADS.

The rapidly expanding US-China trade deficit is a perennial thorn in the side of the two country’s relations. A senior US official said on Saturday the US Commerce Department had helped hammer out the deal. “They will purchase 70 737s from Boeing,” said the US official, accompanying Bush on a four-nation tour of Asia. “We frequently advocate on behalf of American companies.”

Airlines commonly negotiate discounts with aircraft manufacturers that are not disclosed. The final price would also depend on what types of 737s were to be purchased. The order – to be shared among several carriers – marked the latest in a series of coups in Asia for Boeing, which in January signed an agreement with China worth about $ 7.2 billion to sell up to 60 of its newest wide-body plane, the 787.

Boeing expects China’s domestic passenger market to grow at an average annual rate of 8.8 percent over the next 20 years. Officials from Air China Ltd., China Southern, China Eastern Airlines Corp. Ltd. and Hainan Airlines Co. Ltd. either said they were unaware of new orders to be signed in the near future or were not immediately contactable.

<B>Steve HOLLAND</B>