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now reviewed by Han. My own reading of this would be that any change in whom Li reports to is more likely to be the result of Gu's difficulties as a member of the oil group. It is also likely that Han's star is waxing. He is, in any case, already a member of the Central Committee and a permanent member of the Central Commission for Inspecting Discipline.

3.

The most interesting point for us locally which Wu made was a claim that there was a 'life and death struggle' between Wang Kuang, the First Director of the Hong Kong Branch of the NCNA, and Jin Yaoru (6855/1031/1172) the Chief Editor of the Wen Wei Po. The struggle is for

The struggle is for 'supremacy in

Hong Kong'. Wu added that Jin was a personal friend of Zhao Ziyang and that the dispute would certainly have to be solved by Zhao. Whoever wins, he thought the loser would go back to China (in Jin's case to Shanghai). Jin was respected in Peking while Wang was regarded there as a 'local person': I am simply reporting this as passed on to me. I will let you know separately if we have any comments on this allegation.

cc A R Paul Esq

FED FCO

R Wye Esq

Research Dept FES FCO

PJ Williamson Esq HK&GD FCO

(1 C Orr)

CONFIDENTIAL

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