but not our "basket" case) to fall squarely on the Russians and their

allies. In time the Vietnamese are likely to become dissatisfied

with what these partners are willing or able to provide.

There are

already signs that some of the East Europeans are unhappy at having to shore up the Vietnamese economy.

Western aid to Vietnam at this

stage would arguably delay the onset of disillusionment on both sides while not materially affecting Vietnamese policies.

The Chinese factor

27. Teng Hsiao-ping, in the US and Japan, has declined to give any assurance that the Chinese will eschew the use of force against Vietnam (following the numerous Vietnamese "armed provocations" on their common frontier). We cannot identify any worthwhile military

targets for the Chinese to aim at although a limited punitive

strike is well within the capability of the heavy concentration of Chinese troops in the vicinity, and the Chinese might persuade themselves that there was a hope of drawing off Vietnamese forces

from Cambodia.

ASEAN

28.

Members of the Association responded robustly to news of the invasion of Cambodia, and were active in the Security Council debate. The Thais are understandably anxious at what has occurred. Their

Prime Minister, General Kriangsak, and others are in the US seeking a reaffirmation of US political support, and further help with arms deliveries and over refugees. Mr Callaghan and other Ministers had

discussions with the General and his party, and were able to impress on them the British Government's interest in Thailand's (and ASEAN

as a whole's) security and welfare.

CONFIDENTTAL

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