CONFIDENTIAL
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and commercial interests require us to be as forthcoming as we can in the educational field. Others would be prepared to step in if we failed to help the Chinese now. The normalisation of relations with the United States subsequent to Mrs Williams' letter has made it easier for the United States to respond; and we know that there
are considerable funds from non-government education institutions in the USA which could be tapped for this purpose. Help from Britain
now is also a sound investment for the future and one which warrants the modest amount of money required. We therefore consider that we should pursue the possibility of providing a subsidy.
9. If this is agreed, we should have to decide whether to support the programme which the Chinese requested in full or in part; and in either event whether to try to obtain new money or seek a further re-allocation of existing resources. There is a limit to what the British Council can do from the FCC funds; in the circumstances and taking into account China's developmental needs, there seems to be a case for using CDM money.
10. The Chinese educational needs are substantial; and the programme in Mrs Williams' letter was drawn up to help meet these needs.
It is
recommended that we should stick to our part of the bargain and try to meet the programme in full. The total costs are set out in the attached table. In the light of the £320,000 a year which the British Council have found, an additional £380,000 would thus be required in 1979/80; £900,000 in 1980/81 and rather more in later years.
11. It may, however, be argued that our proposals are a target to be aimed at in the light of Chinese requests and their assurances on Finance (from which they have now resiled); and that it is only prudent to look no further than two years ahead in present circumstances. Cur proposals have already been further amended unilaterally by the Chinese, eg as regards an English Language Teaching Institute in China. In the circumstances, we would be justified in holding to the figures providing for a build-up over the first two years (ie 25 British teachers to China in 1978; 50 in 1980/81); but keeping annual expenditure at the second year's level for the remainder of the
/quinquennium.
CONFIDENTIAL