CONFIDENTIAL

(30)

042177

MDTTAN 5763

HK B

02011

Men 14/10

CONFIDENTIAL

FM FCO

TO TELELETTER HONG KONG

TELELETTER

OF 10090OZ OCTOBER 89

AND TO TELELETTER PEKING, MONROVIA

FROM: J MARSHALL, FAR EASTERN DEPARTMENT, FCO

TO: A R CLARK ESQ, ECONOMIC SERVICES BRANCH (SHIPPING), HONG KONG

COPIED TO: S RIORDAN, PEKING

CHANCERY MONROVIA

TAIWAN: POSSIBLE TRANSFER OF TONNAGE FROM HONG KONG TO LIBERIAN REGISTER

1. AS YOU MAY BE AWARE, LIBERIA ANNOUNCED THE RESTORATION OF DIPLOMATIC RELATIONS WITH TAIWAN ON 3 OCTOBER. THE COST TO TAIWAN WAS THE PROMISE OF UPWARDS OF 210 M DOLLARS IN AID.

2.

TAIWAN'S MOTIVE IN BUYING OFF LIBERIA WAS PROBABLY NOTHING MORE SINISTER THAN ITS WISH TO SECURE THE RECOGNITION OF ANOTHER COUNTRY. THIS LATEST QUOTE DEAL UNQUOTE COMES A FEW MONTHS AFTER TAIWAN ESTABLISHED DIPLOMATIC RELATIONS WITH GRENADA. BOTH INCIDENTS ARE OF COURSE CONCRETE EXAMPLES OF TAIWAN'S QUOTE FLEXIBLE DIPLOMACY UNQUOTE. HMA MONROVIA HAS HOWEVER REPORTED THAT TWO ADDITIONAL THEORIES HAVE BEEN FLOATED LOCALLY: A) THAT TAIWAN MIGHT WISH TO SET UP A MANUFACTURING BASE IN AN ACP COUNTRY TO GAIN EASIER ACCESS TO THE EC MARKET PRIOR TO 1992, AND B) THAT THE TAIWANESE ARE CONSIDERING TRANSFERRING THEIR TONNAGE FROM THE HK TO THE LIBERIAN REGISTER PRIOR TO 1997.

WE ARE NOT CONVINCED BY EITHER OF THESE THEORIES BUT WOULD BE GRATEFUL FOR ANY COMMENTS YOU MAY HAVE ON THE SECOND.

3.

4. COPY PASSED TO CHARLES HASWELL, HKD

SIGNED JOHN MARSHALL

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