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CONFIDENTIAL

4.

Secretary of State said that following German re-unification he

expected Soviet troops to remain in Eastern Germany for 3 to 4

years, and Western forces to remain in Berlin; all forces would be

at reduced levels. A united Germany would be a NATO member and the

Russians would have no veto over this.

EC

Secretary of State said that there would be no delay in

achieving the 1992 deadline for a Single Market. He saw no

5.

immediate prospect of Eastern European countries joining as it would

be several years before their economies could be run on lines which

would qualify them for membership.

6. Although there was a great deal of speculation about such

matters as political union, the abolition of currencies and creation

of a Central Bank nothing substantive had yet been tabled. The role

of the European Parliament also needed to be addressed.

Secretary of State told the Foreign Minister that despite

developments in the EC and Eastern Europe, British interests in the South East Asian region remained important.

7.

Hong Kong

8.

Secretary of State said the next seven years would be a difficult period to manage. How did Singapore view the Chinese leadership? Foreign Minister replied that they saw little prospect

of political reform until the last of the 'Long March' leadership

had departed the scene.

Vietnam

9.

Foreign Minister volunteered that they saw the situation in

Vietnam as much worse than Chinese. A fact finding group which had

visited from Singapore described the situation as one of shambles.

Secretary of State commented that the peoples of the north and south

CONFIDENTIAL

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