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DID HOWEVER ADDRESS A MEETING AT CHATHAM HOUSE ON CHINA'S BASIC

DOMESTIC AND INTERNATIONAL POLICIES. HE SUBSEQUENTLY ANSWERED

QUESTIONS AND LATER GAVE A PRESS CONFERENCE. ON THESE OCCASIONS

HE STRESSED CHINA'S NEED TO SLOW THE VERY RAPID PACE OF RECENT

DEVELOPMENTS TO A SPEED THAT WAS STILL FAST AND WHICH COULD

SUBSEQUENTLY BE RE-ACCELERATED.

ON

5. IN TALKS WITH MINISTERS THERE WAS AGREEMENT THAT BOTH SIDES

WERE SATISFIED WITH PROGRESS ON HONG KONG. THERE WAS A GENERAL

EXCHANGE ON EAST-WEST RELATIONS AND THE PROSPECTS FOR A FURTHER

UNITED STATES/SOVIET UNION SUMMIT AS WELL AS CHINA'S RELATIONS

WITH THE SOVIET UNION. THEY TOOK NOTE OF THE DAMAGE THAT HAD

FOLLOWED THE NUCLEAR ACCIDENT AT CHERNOBYL.

SINO-SOVIET RELATIONS HU SAID THAT ECONOMIC EXCHANGES WERE GOING

RELATIVELY SMOOTHLY, AND THAT BILATERAL TRADE SO FAR THIS YEAR

WAS AT HIGHER LEVELS THAN PLANNED. SO FAR AS POLITICAL RELATIONS

WERE CONCERNED, HOWEVER, THERE WAS NOT THE SLIGHTEST SIGN OF ANY

IMPROVEMENT. CHINA WAS SINCERE IN WANTING TO IMPROVE RELATIONS

BUT THE SOVIET UNION ONLY INDULGED IN EMPTY TALK AND UNFRIENDLY

ACTIONS. THERE WAS NO SIGN OF ANY MOVEMENT ON THE THREE

OBSTACLES: CAMBODIA, AFGHANISTAN, AND SOVIET FORCES ON THE

CHINESE BORDER. BOTH SIDES LOOKED FORWARD TO THE QUEEN'S STATE

VISIT TO CHINA IN OCTOBER AND TO FURTHER EXCHANGES OF ALL SORTS

AND AT ALL LEVELS.

6. IN GENERAL, THE CHINESE SEEMED TO USE THE VISIT TO TRY TO

SHOW THE CONSTRUCTIVE, OPEN NATURE OF MODERN CHINA, WHILE STILL

STRESSING ITS COMMUNIST BASIC PRINCIPLES. HU'S ANIMATED AND

OUTGOING PERSONALITY WAS EVIDENT AT BOTH PRIVATE AND PUBLIC

OCCASIONS, AS, FOR EXAMPLE, WHEN HE HANDLED WITH APLOMB DIFFICULT

QUESTIONS AT CHATHAM HOUSE ON TIBET AND HUMAN RIGHTS IN CHINA.

7. IN ANSWER TO QUESTIONS MASEFIELD CONFIRMED THAT THERE HAD

BEEN DISCUSSIONS BETWEEN MEMBERS OF HU YAOBANG'S PARTY AND

APPROPRIATE MINISTERS, PARTICULARLY MR WALKER AND MR CHANNON'S CALLS

ON LI PENG AND DISCUSSIONS BETWEEN ZHOU NAN AND MR RENTON.

MASEFIELD CONFIRMED THAT THESE LAST DISCUSSIONS HAD INCLUDED HONG

KONG, WHICH WAS ONE SUBJECT AMONG SEVERAL BILATERAL MATTERS

INCLUDING CLAIMS, AIR SERVICES, THE STATE VISIT, ETC. AS A

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