11. (PARAGRAPH 15 OR TUR). WE HAVE NOW ESTABLISHED IN BROAD TERMS WHAT OTHER DEVELOPED COUNTRIES ARE OFFERING CHINA BY WAY OF (NEXT WORD UNDERLINED) AID (SEE MIFT). I CONTINUE TO HOPE THAT THE PRIME MINISTER MAY BE ABLE TO SPEAK ABOUT MIXED CREDIT IN THE WAY |

HAVE RECOMMENDED.

12. (PARAGRAPH 17 OF TUR).

(A) I ASSUME THAT THE PRIME MINISTER WILL BE BRIEFED TO MENTION OUR WISH TO NEGOTIATE A CIVIL (NEXT 3 WORDS UNDERLED) NUCLEAR COOPERATION AGREEMENT. AN IMPORTANT POINT HERE IS THE REVELATION BY LI PENG TO A JAPANESE DELEGATION IN NOVEMBER THAT CHINA HAD DECIDED TO ALLOW TAEA INSPECTION OF CHINA'S NUCLEAR SITES. THIS APPARENT SHIFT IN CHINESE POLICY HAD PERHAPS BEEN FORESHADOWED BY THE INCLUSION OF A SAFE-GUARD CLAUSE IN THE NUCLEAR COOPERATION AGREEMENT RECENTLY CONCLUDED BETWEEN CHINA AND BRAZIL.

(B) ON THE (NEXT WORD UNDERLINED) IPPA, THE PRIME MINISTER COULD WELCOME PROGRESS MADE IN THE FIRST ROUND OF TALKS, CONDUCTED AT THE END OF LAST MONTH, AND EMPHASISE THE IMPORTANCE OF A SUCCESSFUL CONCLUSION OF THIS AGREEMENT FOR THE ENCOURAGEMENT OF BRITISH INVESTMENT IN CHINA.

(C) THE PRIME MINISTER SHOULD BE BRIEFED ON THE PROPOSED VISIT IN JANUARY BY THE CHINESE MINISTER OF ASTRONAUTICS TO SIGN THE (NEXT TWO WORDS UNDERLINED) SPACE MOU AND ON THE ENTRY INTO FORCE NEXT YEAR OF THE (NEXT THREE WORDS UNDERLINED) DOUBLE TAXATION AGREEMENT.

13. SEE MIFT.

EVANS

FUTURE OF HONG KONG

LIMITED

HD/HKD

HD/FED

HD/PLANNING STAFF

HD/PUSD

DEP HD/PUSD

RESEARCH D (MR WALKER)

PS

PS/LADY YOUNG PS/ER LUCE PS/PUS

MR DEREK THOMAS

SIR W HARDING MR GOODALL MR WILSON

SIR J FREELAND

COPIES TO:-

BUCKINGHAM PALACE

PS/LORD PRESIDENT OF THE COUNCIL

PS/HOME SECRETARY

PS/CHANCELLOR OF TH EXCHEQUER

PS/LORD PRIVY SEAL

PS/SECRETARY FOR TRADE & INDUSTRY

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MR ROBERTS NEWS D

MR FIFOOT LEGAL ADVISERS

MR BURROWS LEGAL ADVISERS

MR POWELL NO 10 DOWNING ST.

MR INGHAM NO 10 DOWNING ST.

MR MARTIN ASST STAFF CABINET OFFICE MR CARTLEDGE CABINET OFFICE

MR COLVIN CABINET OFFICE

PS/S OF S FOR DEFENCE

PS/ATTORNEY GENERAL

SIR P CRADOCK ROOK K195

SIR P CRADOCK NO 10 DOWNING ST. MR KELLY

TREASURY

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