5.

CONFIDENTIAL

Were it not for Mr Gorbachev's visit the authorities

might well have decided to sit it out until the end of

the University term (in July). They are already taking

action behind the scenes. There have been reports that

some prominent intellectuals have been warned off giving

support to the students cause. They might well step this up by seeking to identify and arrest student leaders. It

is ominous that the State Council spokesman referred on 3 May to the alleged role played by the US-based Alliance

for Democracy. If handled uncautiously, however, such action would just as easily set off the very

demonstrations it was intended to prevent.

C

6.

Both the authorities and the students will need to

exercise caution and restraint if a face saving way out

is to be found. As far as the leadership is concerned

Sir Alan Donald has argued (Peking telno 740) that the

failure of the government's tough stance represented by

the People's Daily editorial of 26 April has already

meant personal humilation for the Premier Li Peng and

possibly also for Deng Xiaoping. But no member of the

leadership seems ready to take the risk of adopting a

resolute stance (either in using the students demands to

push through political reforms or in using the state apparatus to prevent further manifestations) for fear of the possibly adverse consequences.

The opportunities may

/well

4

CONFIDENTIAL

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