CONFIDENTIAL
CHINA
I.
INTRODUCTION
1.
The death of Chou En-lai was followed within a matter of days by attacks on Teng Hsiao-p'ing, who had been widely expected to be his successor. This has increased the difficulties in predicting the future course of Chinese policies. However, there are certa in constraints which are unlikely to change during the next few years, and these provide a basis for the recommendations in the con- cluding paragraphs.
II
CHINA'S INTERNATIONAL ROLE
Back ground
2. Because of China's large population and geographical situation, Chinese society and culture have always been remarkably self-contained.
In the past the Chinese have seen themselves as the centre of the civilized world. Under the impact of nineteenth century Western imperialism, introspection became tinged with xenophobia, and traces of this remain today. Foreign trade has always been small in relation to GNP. Chinese who have settled abroad and their descendants have traditionally retained their cultural affinity with the homeland, and in most countries of settlement have remained a distinct community. Internally, periods of strong central leadership have alternated with those when provincial centres have become powerful, but always without fundamentally splitting the unity of the Chinese people or the territory of China.
The Communist Régime
3. Although Communism has brought sweeping changes, certain traditional attitudes persist. China's leaders have announced it as their aim to build an independent industrial and economic system by 1980 and to achieve comprehensive modernization by 2000, which would place the economy in the front ranks of the world. China remains primarily concerned with her internal problems, although her leaders accept that the Soviet Union must be opposed on more than one front and that technological skills and materials essential for development must be acquired from outside. Typically they have sought to re-establish frontiers which they consider were pushed back unfairly at earlier times of weakness. Thus, under Mao, the Chinese have re-absorbed Tibet, fought a border war with the Indians and quarrelled over the boundary with the Soviet Union. By a variety of means they have established a presence in a number of small states on their southern flanks.
China in the World
4. China is the world's most populous country. She produces vast amounts of grain and is close to self-sufficiency in food. She has discovered, and begun to exploit, a wide variety of the natural resources necessary to a modern industrial state. American estimates put the figure for China's industrial production at 3.6%
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CONFIDENTIAL