Trump spokesman Jason Miller told reporters that the President-elect announced Branstad's selection at a fundraising breakfast in New York on Wednesday. He told reporters that the Iowa governor has "considerable public policy experience," a "great grasp" of trade and agriculture issues, and "very much impressed the president-elect."

 "It is very clear that Governor Branstad is someone who will represent our country well on the world stage and we couldn't be prouder of this selection," Miller added.

The governor will join Donald Trump and vice president-elect Mike Pence at an Iowa rally on Thursday, as part of the incoming Republican president's "Thank you" tour.

Beijing welcomes Branstad appointment

Branstad's appointment suggests that Trump is prepared to take a less combative stance towards relations with China. The move may also ease trade tensions between the world's two largest agricultural producers.

China's Foreign Ministry spokesman Lu Kang called the Iowa governor an "old friend" of China.

"We welcome him to play a greater role in advancing the development of China-US relations," Lu said at a daily news briefing Wednesday.

Branstad has known Chinese President Xi Jinping since 1985, when Xi visited Iowa in 1985 as part of an agricultural research trip where he led a delegation from the Hebei Province.

The Iowa Governor called the Chinese leader a "longtime friend" during Xi's state visit to Des Moines in 2012, months before Xi become president. Branstad also hosted a dinner reception for Xi as part of the visit.

Iowa's biggest export market

Huang Jing, an expert on Chinese politics at the National University of Singapore, told news agency Reuters that Branstad was perfectly-placed to deal with China-US trade issues. China is one of Iowa's largest export markets for agricultural products.

During Xi's 2012 visit, the Chinese president announced that China would purchase more than $4 billion in US soybeans that year. Since then, the US has heavily relied on China's insatiable appetite for agricultural commodities to spur global demand and stem a global oversupply that threatens to hurt prices.

"This really sends a message that Donald Trump wants to handle China at the bilateral relationship level," Huang said.

Pan Chenjun, senior analyst at Rabobank in China, told Reuters: "It's natural that they should continue this good relationship with China." 

Trump rattles relations with China

Branstad's nomination comes amid fresh tensions between the US and China. Last week, the incoming Republican president broke almost four decades of diplomatic protocol by speaking directly to Taiwan President Tsai Ing-wen. The move called Beijing's "One China" policy into question, risking a serious rift between the world's two largest economies.

Trump's transition team played down the exchange as a courtesy call. However, the White House was forced to reassure Beijing that its policy remained intact.

However, Trump himself responded to China's protests on Twitter, accusing Beijing of currency manipulation and militarizing the South China Sea.

During his presidential campaign, Trump also accused China of trying to "rape our country" with unfair trade policies, vowing to impose punitive tariffs on Chinese goods coming to the US upon taking office.

US trade concerns include allegations that China is dumping steel and aluminum in global markets. The US has also been unable to get Beijing to lift anti-dumping on a number of agricultural goods, including broiler chicken products and animal feed ingredients.

'Person of the Year'

On Wednesday, Time magazine named Trump its 'Person of the Year' for 2016.

The magazine's managing editor Nancy Gibbs said the choice was "straightforward."

"When have we ever seen a single individual who has so defied expectations, broken the rules, violated norms, beaten not one but two political parties on the way to winning an election that he entered with 100-to-1 odds against him?" Gibbs said.

Trump described Time magazine's bestowment as an "honor."

dm/se (Reuters, AFP)