SECRET

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9. If it is agreed that we respond to the approach, both

we and the Commonwealth Office think that Mr. Cater, formerly

Deputy Colonial Secretary but who now holds the para-governmental

appointment of Executive Director of the Trade Advisory Council,

would be our best representative. Kis nomination would serve

Development-

to emphasise the informal nature of the talks; and he would be

more easily disowned, if need be, than the Political Adviser.

10. The present position on the various issues which will

have to be discussed at an Office reeting on Sino-British relations

is as follows:

(a) Mr. Fatt

See paragraph 6(a) above. Sir D. Hopson is trying to obtain

details of the charges and of the trial, and consular access.

(b) Er. Grey, the Reuters correspondent detained in Peking

Discussions are proceeding with representatives of New China

News Agency (N.C.N.A.) in Hong Kong about additional visits by

N.C.N.A. representatives to communist journalists in prison.

These visits would be on the clear understanding of reciprocity

in the form of visita to Mr. Grey -

(o) 8.8. "Demodocus"

s.s.

See paragraph 6(c) above. The Chinese employee of the Blue

Funnel agents in Hong Kong who has been in Shanghai dealing with

the detention of the ship, is due back in Hong Kong tomorrow.

His last message from Shanghai seemed to hold out some hope that

the ship right soon be releaved.

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