ATC
4. IT MAY BE HELPFUL TO SUMMARISE WHAT IS IN THE BILATERAL BASKET ALREADY 1.E.
(1)
A RAISING OF T
LEVEL OF OUR RELATIONS BY THE PRIME
MINISTERIAL VISIT, AND THE INVITATION TO ZHAO ZIYANG. TO
VISIT BRITAIN.,
(11) THE ANNOUNCEMENT OF A MODEST AID PROGRAMME.,
(111) THE POSSIBILITY OF SOME PROGRESS ON GUANGDONG NUCLEAR
CO-OPERATION.,
1
(IV) MINOR. ITEMS: CONSULATES IN SHANGHAI AND IN LIVERPOOL OR
MANCHESTER., AND
(V)
PUBLICITY FOR CULTURAL CO-OPERATION (BOOKS) AND RECENT EXCHANGES OF ART EXHIBITIONS., THE ROYAL BALLET IN 1983,
ETC.
5. BILATERAL ASPECTS OF THE VISIT WILL BE GIVEN AN IMPORTANT FILLIP IF, AS WE MAY NOW HOPE, THE LUDA 051 DEAL CAN BE SIGNED BY
- NOT 20 SEPTEMBER (MY LETTER OF 9 AUGUST TO MARK ELLIOTT REFERS TO HONG KONG). THAT WOULD IN ITSELF BE A VERY SUBSTANTIAL MAKE- WEIGHT. THERE IS ALSO A CHANCE THAT AN IMPORTANT PILKINGTON GLASS CONTRACT COULD BE SIGNED WITH A SHANGHAI ENTERPRISE BY MID-
SEPTEMBER..
6. THERE ARE TWO OTHER WAYS IN WHICH WE COULD CONSIDER IMPROVING OUR PROSPECTS FOR INCREASING TRADE WITH CHINA, TO REAL MUTUAL ADVANTAGE. THE FIRST OF THESE CONCERNS THE TECHNIQUES - ALREADY
USED BY SOME OF OUR COMPETITORS HERE FOR MIXING OFFICIAL GRANTS OP SOFT LOANS WITH STRAIGHTFORWARD CREDITS TO REDUCE THE EFFECTIVE
OVERALL INTEREST RATE CHARGED: SEE GERALD CLARK'S LETTER TO YOU OF 9 AUGUST. THE SECOND, AND MORE CONVENTIONAL IDEA, WOULD BE FOR US TO EMULATE THE MAJORITY OF OUR EC PARTNERS BY BREATHING SOME
LIFE INTO OUR 1979 ECONOMIC CO-OPERATION AGREEMENT WITH CHINA.
(ALL EXCEPT THE DUTCH AND THE IRISH HAVE SUCH AGREEMENTS WITH CHINA).
THE OBVIOUS WAY TO DO THIS WOULD BE TO REVERSE THE DECISION WE TOOK
THEN (AND RE-AFFIRMED LAST YEAR) TO DO WITHOUT AN ANNUAL JOINT COMMISSION TO REVIEW ECONOMIC AND COMMERCIAL PROSPECTS AND PROBLEMS.
THE GERMANS, FRENCH, ITALIANS, DANES, AND BELGIAN/LUXEMBOURG
REPRESENTATIVES HERE ALL SAY THAT SUCH ANNUAL MEETINGS, ALTHOUGH
USUALLY GENERAL IN CONTENT, ARE USEFUL BECAUSE THEY RAISE CHINESE
POLITICAL AWARENESS OF THE STATE OF BILATERAL TRADE, AND HELP TO
GIVE PROJECTS GREATER RESPECTABILITY''. IT IS NOTEWORTHY THAT
NONE OF THEM SEEM TO HAVE BEEN AS BADLY AFFECTED BY ''READJUSTMENT''
AS US. GERALD CLARK WILL BE SENDING CORLEY (DOT) AND YOU A TELE-
LETTER ON THIS SUBJECT SHORTLY. A NEAT WAY TO LAUNCH THIS WITHOUT
WIDER INITIAL COMMITMENT WOULD BE FOR THE PRIME MINISTER TO
SUGGEST TO ZHAO THAT CHEN MUHUA SHOULD VISIT BRITAIN SOMETIME SOON
很