GRPS 350

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FM F C O 111735Z MAY 79

TO ROUTINE PEKING

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TELEGRAM NUMBER 272 CF 11 MAY 1979

INFO HONG KONG

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1 4 MAY 1979

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SHIPPING

GEORGE'S TELE-LETTER OF 8 MAY

MR SHEN CHAO-CHI, FIRST SECRETARY MARITIME, CALLED ON THE DEPARTMENT OF TRADE ON 10 MAY, TO CONVEY AN INVITATION FROM THE COMMUNICATIONS MINISTER TO SIR LEO PLIATZKY TO VISIT CHINA POSSIBLY IN JUNE, TO NEGOTIATE A MARITIME AGREEMENT

2. DOT EXPLAINED THAT WHILST WE WERE ANXIOUS TO CONCLUDE A MARITIME AGREEMENT WITH CHINA, THERE WERE A NUMBER OF DIFFICULTIES. IN THE FIRST PLACE, DOT HAD A NEW PERMANENT SECRETARY (CLUCAS) AND IT WAS NOT CLEAR WHETHER HIS OTHER COMMITMENTS WOULD PERMIT HIM TO TAKE AN EARLY ACTIVE PART IN THESE NEGOTIATIONS SECONDLY, THERE WAS THE HONG KONG PROBLEM, ON WHICH WE UNDERSTAND THE CHINESE VIEW TO BE THAT IT WAS A MATTER OF FINDING THE ''BEST WORDS''. (GEORGE'S TELELETTER OF 23 APRIL). IT WOULD BE HELPFUL IF THE CHINESE WOULD TAKE THE INITIATIVE BY PROPOSING HOW HONG KONG MIGHT BE INCLUDED. THIRDLY WHILE A MARITIME AGREEMENT WOULD BE USEFUL, ITS VALUE WOULD BE REDUCED UNLESS THERE WERE REASONABLE ASSURANCES OF EQUITABLE DISTRIBUTION OF THE CARGO BETWEEN THE SHIPS OF OUR TWO COUNTRIES ON REMUNERATIVE TERMS: WE HAD PUT PROPOSALS ABOUT THIS TO THE CHINESE IN FEBRUARY AND MR VARLEY HAD MENTIONED IT, SO THAT IT WAS RATHER EMBAR- RASSING THAT WE HAD NOT SO FAR HAD ANY REPLY. (THE MEETING TOOK PLACE BEFORE RECEIPT OF YOUR TELELETTER OF 8 MAY). IT WOULD BE DESIRABLE TO KNOW THE CHINESE THINKING ON THE TWO LATTER POINTS BEFORE GETTING DOWN TO DETAILED NEGOTIATIONS. MR SHEN UNDERTOOK TO REPORT BACK TO PEKING FOR FURTHER INSTRUCTIONS.

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