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effect if Britain appeared to the Chinese to be
unwilling to discuss military sales. This might make
little difference in the end if all our partners acted
likewise, but could seriously affect British civil
exports if others, and especially the French, were more
forward than we over military sales.
32. A significant expansion of civil exports to China
would have no repercussions for British exports in
third countries. Defence sales could, however, incur
negative reactions, notably in the Soviet Union and
perhaps the United States. If, for example, Rolls Royce
were seen to be actively involved in a large sale of
Harriers to China at a time when their RR211 deal with
the Soviet Union was still under negotiation, the Russians
might prefer on political grounds to turn to Rolls
Royce's American rivals. The Spey deal does not,
however, appear to have harmed either Rolls Royce's or
general British exports in the Soviet Union. The
Russians normally hardheadedly seek the best product for
their purpose on the best terms. But political
considerations are not to be excluded.
No rules can
be laid down in advance except to say that, in the
first instance, the firm must judge its own commercial
advantage. If wider British commercial interests looked
like being involved, however, the Government would need
to intervene.
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