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Los

es/Bond Genet PS/PUJ

10 DOWNING STREET Mr Gillmon

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LONDON SWIA 2AA

Sir Dmitr

From the Private Secretary

22/6

19 June 1987

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HKD News

FAREWELL CALL BY THE CHINESE AMBASSADOR

The Chinese Ambassador paid a farewell call on the Prime Minister this afternoon.

The Prime Minister congratulated the Ambassador on his work in London. It had been an exceptionally active time in our relations which he had managed with great skill and energy. We were also very grateful to his wife for the part she had played in the success of his mission. The Ambassador clearly had an unrivalled knowledge of the United Kingdom spanning more than thirty years. The Ambassador said that he had very much enjoyed his time in London. He had noticed and reported very far reaching changes in Britain, particularly in the last few years. He was also glad that relations between Britain and China were now on such an excellent footing.

The ensuing conversation covered a wide range of international issues. The Prime Minister referred to Vietnamese occupation of Cambodia, to the situation in the Middle East, to Afghanistan and to the difficulties confronting Mr. Gorbachev in introducing change in the Soviet Union. The Ambassador commented that there had been some improvement in Sino-Soviet relations in the trade and economic sphere, but there had been no thaw in political relations. The three obstacles still remained. The Prime Minister commented that they were very wise criteria.

The Prime Minister referred to the appointment of a new Governor in Hong Kong and commented that the work of the Joint Liaison Group appeared to be going well. She noted that the arrangements made for Hong Kong had been the pattern for similar arrangements subsequently for Macau. The Ambassador equally expressed satisfaction with progress in Hong Kong.

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The Ambassador volunteered that Hu Yaobang's resignation had not meant any change in policy in China. policies were simply being carried out in a more effective manner. Hu Yaobang was still a member of the Politburo. Prime Minister said that she had always found him a most congenial interlocutor. She sent her best wishes to Chairman Deng Xiaoping and to Zhao Ziyang as well as to Hu Yaobang. The Ambassador mentioned the good working relationship

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