CONFIDENTIAL

to the Chinese a more balanced view on world political

issues.

At a time when a solution of the Vietnam

conflict is at least conceivable, and our

Co-Chairmanship of the Geneva Conference may assume

a new relevance, we are cut off from any access to

Chinese leaders. It is true that the Cultural Revolution

and the current intransigence of the Chinese Government

would probably make such contacts rare and unrewarding

in any event; but as a result of our dispute with the

Chinese we suffer an additional and basic disability.

British

If any opportunity for diplomacy were to occur we certainly

could not seize it. The damage has also taken more

tangible forms affecting our interests. The volume

of British exports to China will fall sharply this year

and this is attributable in part at least to the

events of the past year. No British businessman is

entirely safe visiting this country. Cultural exchanges

between the two countries are non-existent.

subjects are arrested or detained in China: not only

Mr. Grey of Reuters, now under solitary confinement for

a year, but British merchant navy officers taken from

their ships, and the British community in Shanghai,

denied permission to leave and living under harassment

and fear. Virtually all British subjects in this country

are under some form of restraint, and we are unable to

exercise the most basic consular functions for their

protection.

Meanwhile we in

CONFIDENTIAL

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