By DAVID E. SANGER - New York Times

February 18, 1997

WASHINGTON Clinton administration officials said on Monday that they believed that the health of China's paramount leader, Deng Xiaoping, had deteriorated significantly in recent days and was the reason for the sudden return to Beijing this weekend of several other top Chinese leaders.

Deng, who is 92 and has not been seen in public since he visited Shanghai in 1994, has often been reported to be on the verge of death in the last few years.

"This could be another one of the false warnings," said one senior American official who monitored internal government reports about Deng's health during the weekend. "But there is clearly a lot of activity on the part of the leadership, and there is clearly a belief in Beijing that a bad situation has turned worse."

Another administration official said: "Clearly, he is very sick, but it's not clear how much sicker than the usual very sick."

For years, officials in Washington have debated what impact the death of Deng, whose economic reforms remade China into one of the powerhouse economies of the world, may have on China's succession struggles and its dealings with the United States.

But Deng has survived for so long that many China watchers and policy makers here routinely say they now believe that the bulk of the transition of power has already taken place. If Deng dies in the coming months, they speculate, political events in Beijing can be frozen until the next Communist Party congress, in October.

The movements of China's other leaders have long been watched with care by American intelligence officials, because their travels may be the only reliable sign of a sharp deterioration in Deng's health.

So American officials took particular interest in intelligence reports and press accounts that President Jiang Zemin, who is also the chief of the Chinese Communist Party and the head of the army, abruptly returned to Beijing during a weekend trip to Jiangxi Province, in the center of the country.

At the same time, Prime Minister Li Peng also returned to Beijing hurriedly, cutting short a visit to Guangdong, the booming southern province closest to Hong Kong. The travel by the two leaders was first reported by Reuters.

Rumors of Deng's impending death regularly shake the Hong Kong stock market, and on Friday the Hang Seng index fell nearly 1 percent after a newspaper there reported that Deng had suffered a stroke.

But U.S. officials said they had no independent confirmation of that report, and on Monday the Hong Kong market rose fractionally.