Richard Fletcher-Cooke Esq
2 -
-
14 April 1987
3. Sino-Soviet Relations. Zhou said that negotiations on borders marked only a preliminary stage. There would have to be considerable number of talks before the Chinese were convinced of Soviet sincerity. At present the only thing that could count as a positive result was Moscow's willingness to consider the middle of the Amur River as the border between the two countries. Shevardnadze's last visit to the Far East had shown that on the three obstacles, particularly Vietnam and Cambodia, nothing has changed.
4. On the internal situation inside the USSR, Zhou Nan said that China believed in Gorbachev's desire to reform but had doubts about the solidity of his support. While Gorbachev has control of the Politburo, it is less sure that he has sufficient allies in the Central Committee, in the Army, or in the KGB.
5.
5. On the US Zhou Nan brought up the Taiwan 'obstacle' and expressed himself disappointed by the 'ambiguous' announcement made by Shultz during his recent visit to China on the subject of the improvement of postal, maritime and air links between Taiwan and China. Zhou also said that the Americans had not reduced weapon sales to Taiwan sufficiently to match their promises in the Joint Communique.
6.
EC Representative Office. While welcoming the opening of this office, Zhou said that the Chinese side might find it difficult to find sufficient accommodation and office space to house a delegation of five people.
7.
On the current anti bourgeois-liberalisation campaign, Li Peng had said certain responsible people had not exercised sufficient firmness. On the other hand people have not made a clear enough distinction between the importation of technology and the importation of capitalism.
8.
On the need for economic readjustment, Li Peng said this had been caused by an imbalance in the supply/demand situation and that the economy had begun to overheat once more. Expenditure, notably on con- struction, exceeded China's financial means. While many foreigners were impressed by the number of buildings recently constructed, they were not aware that many of them were still without water or electricity. The energy, transport and communications sectors had been neglected. The structure of investment needs changing.
9.
Foreign Investment. In a number of meetings de Clercq's interlocu- tors declared themselves desirous of increased cooperation with Europe. Ulanhu said that China would take further steps to improve conditions of foreign investment.
Jov
Chuter Paton
C W PARTON
First Secretary Economic