HKDAFZ

SECRETARY OF STATE'S MEETING WITH US SECRETARY BAKER

China

We are at one with the US administration in our reaction to recent

events in China. The package of measures announced at the Paris Economic Summit reflected measures already adopted by us, the US and

a number of other partners. The US administration is however under

congressional pressure for further sanctions, particularly in trade relations. This pressure may grow if tension with China over the

refuge being given by the US Embassy in Peking to the leading

dissident Fang Lizhi incrases. It would be useful to underline to

the US our continued opposition to general trade/economic sanctions:

we do not wish to isolate China; trade sanctions would be harmful to

the Chinese people, and to Hong Kong.

Far Eastern Department

27 July 1989

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