From 1989 to 1993 he was Governor of Hainan Province, where he had a highly antagonistic relationship with the Chinese Communist Party Committee Secretary Deng Hongxun.
[4] However, Liu was unable to work together with the Chinese Communist Party Committee Secretary of Hainan, Deng Hongxun, who was associated with the central leaders Jiang Zemin and Qiao Shi.
[4] Li was imprisoned after the accusation was proven false, and Liu launched a counter-investigation to find the instigator, rumoured to be Deng.
Their infighting became an embarrassment to the central government, which transferred both of them to Beijing in January 1993, and replaced them with a single official, Ruan Chongwu.
After a brief stint as vice-minister of the Ministry of Industry and Information Technology from March to June 1998, he was appointed Director of the Civil Aviation Administration of China.