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smaller high technology projects through joint venture investment with local manufacturers. British consultants should also be encouraged to seek a high quota of projects financed by EC funds for ASEAN. In competing for the bigger projects British companies should sometimes consider combining forces with the Japanese rather than trying to go it alone. Growing interest in English languåge training is another asset which we should turn to our commercial advantage by expanding British Council English language centres in the most important ASEAN mertars
Trade Discrimination
8. Two ASEAN countries have demonstrated their willingness to act against British commercial interests because of their
dissatisfaction with British policies. Faced with increasingly protected markets and world recession, they may resort increasingly to trade discrimination in retaliation for UK protectionism or unrelated issues. Alternatively they may resort to a counter-purchasing policy on the Indonesian model to control the level of imports. This action is difficult to counter since other OECD countries will regard it as providing an opening for their own exports rather than as an issue over which to make common cause with the target of discrimination. Counter measures could all too easily backfire on the UK for example by causing ASEAN to gang-up. We should therefore concentrate on preventive measures to ensure that Britain does not set itself up as an obvious target for further discriminatory action in future. In international economic negotiations of interest to ASEAN such as the MFA or commodity negotiations or in any EC reaction to Indonesian counter-purchasing policy we should try to stay in the middle of the EC pack. should recognise that any further public expenditure cuts, eq. in BBC external services could give rise to problems similar to those created by the increase of overseas student fees. Our aim should be to mitigate potential damage to British interests as far as possible by explanation at an early stage.
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Defence Commitments
10. Despite the end of our direct military role in South East Asia in 1971, we still have residual defence commitments to four of the ASEAN countries as well as Brunei. A Malaysian attack on Brunei is very unlikely at present, but an outbreak of civil disorder in Brunei could be potentially embarrassing to HMG if the Sultan tried to involve the large number of British long-service personnel in his armed forces or the resident Ghurka battalion. On present plans, British forces are likely to remain in Brunei for some years after full independence in 1983 and for as long as they remain there is no assurance that the Sultan would accept any limits placed on his authority over them. As a signatory of the Manila Pact we are committed to come to the help of Thailand or the Philippines if they are attacked and to consult other signatories in the event of internal insurrection. A Vietnamese attack on Thailand or internal unrest in the Philippines are just conceivable. Under the Five
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