14 Mr Mallaby's submission of 27 July and Mr Bullard's minute of 31 July. I assume that Ministers would therefore wish to consider the proposal for a RN

visit to China in isolation. A visit by the same RN task group to a Chinese and then a Russian port (even with an intervening visit)in between) would in

any case not be appropriate and would lose us whatever goodwill with the Chinese a visit to a Chinese port

per might gain. There has not been a Royal Navy visit to a Chinese port since 1949. The Chinese have indicated informally that they regret this, and that

they would strongly welcome a visit. However, now

formal invitation for an RN visit has been issued, and before detailed planning can begin we shall need to draw formal approval from the Chinese for a visit to take place.

३. The task group would probably visit Shanghai in August 1980. The First Sea Lord's visit would take place earlier in the year. The Chief of Defence Staff visited China in 1978; and the Chinese Deputy Chief of General Staff (who is in effect Chief of Defence

Staff, since that position is formally held by Vice Premier Deng Xiaoping) visited the UK in June this]

year.

Argument

7. A Royal Navy visit would be a natural part of our

developing relationship with China. Ministers have

taken the view that our commercial relations with

China should inelude a defonce sales element.

If a

visit is not arranged soon, the Chinese will take it as indicating our lack of interest and commitment to developing our relations with them. They would compare our attitude unfavourably with the French,

who arranged a visit by one naval ship to China last

year.

8. A visit might also help to promote defence sales,

particularly of naval equipment. The Chinese have expressed interest in a wide range of naval equipment, particularly marine gas turbines, shipborné communications systems, navigation equipment, certain naval missiles and destroyers. Ministers have agreed that British

Se

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