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RMorland
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Mr Mørland Miss Brown
CONFIDENTIAL
I suggest you avoid commitment on X until
it has been possible to discuss the pros seans more fully with FED & H Ko General.
ARMorland 1472
B
3 U
E
X
UK/CHINA EXCHANGES ON SHIPPING MATTERS
1.
Miss Brown will attend Mr Morris' meeting at 5pm tomorrow to discuss where we now stand on this question.
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2. Since the developments recorded in my submissions of 23 January and 1 February the Chinese have themselves provided their own version of a draft Economic Agreement (Peking tel No.130 to FCO). Shipping is included in Article 3. DOT think the mention is too general to satisfy the GCBS who want
DOT provisions which will secure a greater share of the bilateral trade.
think the Chinese draft could nevertheless provide a peg on which to hang an exchange of letters which could meet GCBS objectives, as well as specifying other areas of cooperation in shipping. (A suggested text is in paragraph 5 of FCO tel No.66 to Peking). Ideally an exchange of letters could take place during Mr Varley's visit to China from 24 February to 5 March (paragraph 5 of FCO tel No.66 to Peking) and FED have asked HM Embassy Peking to remind the Chinese about this (FCO tel No.143 to Peking).
3. Mr Morris would like the meeting to consider what should be done if the
DOT believe that one of Chinese do not reply before Mr Varley's departure. their officials should accompany Mr Varley to China so that the question of shipping could be specifically raised with the Chinese and would like to explain to the Chinese what the UK would like to accomplish within the context of the Economic Cooperation Agreement. They also believe that the question of. a separate Maritime Agreement to cover detailed operational shipping matters might also be raised during Mr Varley's visit. In this last context they would like to try to explore the current Chinese attitude towards including Hong Kong in such an agreement (the Chinese negative on this was given two years ago). If the Chinese seem unenthusiastic about an exchange of letters or a Maritime Agreement or both DOT would like to hear the Chinese own suggestions.
4.
We and geographical departments think that the question of an exchange of letters to go with the Economic Cooperation Agreement could certainly be raised with the Chinese and have no objection to a DOT representative joining Mr Varley's team. But both FED and Hong Kong and General Department are unlikely to welcome re-opening the question of a Maritime Agreement. They see no reason at all to think that the Chinese view on Hong Kong's inclusion will have changed and, given that, cannot see that British shipowners would get out of an agreement anything
This c may which would outweight the disadvantages for Hong Kong of exclusion.
be true: but I think it is nonetheless worth sounding Chinese views which may
have changed in the course of two years. We owe it to the shipping industry to try and help and there
reasons why, if the Chinese are prepared to
M
contemplate bilateral shipping arrangements with the US (where difficulties
CONFIDENTIAL
/may