CONFIDENTIAL

J

6. THERE IS SIMILAR INTENSE ACTIVITY IN THE FIELD OP

SCIENCE AND EDUCATION. THE LATEST CHINESE PROPOSALS TO

SEND VERY LARGE NUMBERS OF STUDENTS AND GRADUATES TO

BRITAIN, THEIR REQUESTS FOR BRITISH TEACHERS AND EDUCATIONAL MATERIAL, AND THEIR READINESS TO PAY A GREAT

PART OF THE COSTS DEMONSTRATE THEIR SERIOUSNESS. THE

ENGLISH LANGUAGE, AS THE KEY TO MODERN TECHROLOGY, 13 IN GREAT DEMAND AND GIVES US SPECIAL OPPORTUNITIES.

7. THIS CHINESE ACTIVITY IS MAINLY DIRECTED AT JAPAN, WITCH ENJOYS SPECIAL ADVANTAGES, TO LEADING WEST EUROPEAN KOUNTRIES, IN PARTICULAR WEST GERMANY, FRANCE ITALY AND BRITAIN, AND TO THE US. IN THE EUROPEAN GROUP WE HAVE SOME ADVANTAGE BECAUSE OF ENGLISH BUT LAG WELL BEHIND

THE WEST GERMANS IN LEVEL OF TRADE AND STILL I FEAR IN

DEGREE OF COMPETITIVENESS. BOTH THE GERMANS AND FRENCH

ARG AHEAD OF US IN THEIR POLITICAL RELATIONS WITH CHINA, THEIR PRIME MINISTERS HAVE BEEN HERE AND TENG HSIAO-P {NG,' THE SENIOR VICE PREMIER, HAS BEEN TO FRANCE. THERE IS A STRONG PROSPECT OF PREMIER HUA KUO-FENG VISITING FRANCE

EARLY NEXT YEAR.

*

2. IN THE PAST THE US HAVE BEEN SOMEWHAT HANDICAPPED BECAUSE SINO/US RELATIONS ARE NOT NORMALISED, BUT WE

SHOULD NOT ASSUME THAT NORMALISATION WILL BE SO LONG

DEFERRED AND ALREADY THE CHINESE TENDENCY IS TO ENCOURAGE

THE PROCESS BY TREATING US FIRMS AND INSTITUTIONS IN MANY

FIELDS AS IF NORMALISATION HAD ALREADY TAKEN PLACE. US

COMPANIES ARE BEING VERY AGGRESSIVE. OUR ADVANTAGE IN

MIS RESPECT IS THEREFORE TEMPORARY AND ALREADY DIMINISHING,

CRADOCK

FCO/WHITEHALL DISTRIBUTION

TED

3

CONFIDENTI AL

COPIES TO:

MR BROWNING, DOT

SIR J HAMILTON,

DEPT OF EDUCATION & SCIENCE

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