CONFIDENTIAL

1

A

B

4. I agree with the recommendations in paragraph 2 of the submission, subject to the following glosses:-

Paragraph 2(b): I find it difficult to see how a Foreign Office Minister can pay what is essentially a goodwill visit to China as early as August. Though there is no immediate need to inform the Chinese, I fear that Lord Glenarthur's visit will have to be cancelled.

Paragraph 2(e): I am sure that it is right to review political exchanges below Ministerial level on a case-by-case basis. I do not think we should follow the Americans (Washington Telno 1717) in a rigid "suspension of all contacts at Assistant Secretary level or above".

I

Paragraph 2(h): Sir A Donald has now provided further advice about the planned SBTC Exhibition in Peking in November (Peking Telno 1200). agree with Sir A Donald and consider that we should press the DTI to cancel the exhibition. Members of the SBTC to whom I spoke over the

weekend took the same view on commercial grounds.

Paragraph 2(1): It is not entirely clear when decisions on new World Bank loans are going to be needed but it is likely to be very soon and it would be helpful to have Ministers' approval for the interim line set out in paragraph 25 of the submission, on the understanding that Ministers' views would be sought separately on any specific proposals.

hayu

R JT McLaren

Cc:

PS/Mr Eggar

PS/Mr Patten

PS/PUS

PS/Sir J Fretwell

Mr Gillmore

Mr Bayne

Mr Carrick

Mr Hervey

Mr Teasdale

Protocol Dept

UND

HKD

COMED

CRD

News Dept

Planners

Mr R Graham-Harrison, ODA

SEND

Defence Dept

ERD

ECD (E)

Information Dept

Research Dept

Mr Millington, FED

- 2 CONFIDENTIAL

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