CONFIDENTIAL
TACTICAL ARGUMENTS
(a) (i) Chernobyl no reason for panic measures on nuclear generating plans: but reassurance on safety important for public eg in Hong Kong. Glad Chinese have confirmed intention to go ahead, including Daya Bay project.
(ii) SDI, SALT II, Global INF.
How far
(iii) How do you see your relations developing with the Soviet Union? Level of political contacts? Party-Party links? can economic cooperation develop without political progress?
But
(b) (i) Britain can contribute much to China's modernisation. need help in Chinese framework. Less stop/go in allocations of foreign exchange, and less volatility in relationship between state and local authorities. Great expense of establishing offices in China, and physical difficulties over communications (telephone, travel, hotel bookings, etc).
(ii) Can offer particular help in some of your highest priority sectors: energy (power generation and transmission; coal mining), telecommunications, transport (ships, aircraft), materials (steel, aluminium), agriculture and food processing.
(d) (i) Claims settlement would make possible Chinese access to London bond market and strengthen China's international financial reputation.
air
CONFIDENTIAL