CONFIDENTIAL

035271

MDHIAN 31

PROJECTS. HE HOPED BRITISH ENTERPRISES WOULD INCREASE THEIR COMPETITIVENESS AND WELCOMED THEM TO INVEST IN JOINT VENTURES OR WHOLLY FOREIGN-OWNED ENTERPRISES. HE ALSO HOPED THAT REGULAR HIGH-LEVEL MEETINGS ON TRADE AND ECONOMIC SUBJECTS COULD BE HELD BETWEEN THE TWO SIDES, AND THAT MR LILLEY THE SECRETARY FOR TRADE AND INDUSTRY, WOULD VISIT CHINA SOON. LORD CAITHNESS REMARKED THAT THE LEVEL OF TRADE BETWEEN THE TWO SIDES WAS TOO LOW AND SHOULD BE

IMPROVED. THIS YEAR IT HAD FALLEN. HE HOPED THAT AS A RESULT OF ZOU JIAHUA'S SUCCESSFUL VISIT THE CHINESE SIDE HAD BEEN CONVINCED THAT ROLLS-ROYCE ENGINES WERE NOT ONLY THE BEST BUT ALSO THE MOST COMPETITIVE AVAILABLE, AND THAT BRITISH AIRCRAFT, IN PARTICULAR THE BAE 146, WERE EXCELLENT VALUE FOR MONEY. ZOU HAD ALSO RAISED THE QUESTION OF MINING EQUIPMENT. A NUMBER OF BRITISH COMPANIES WERE EXTREMELY INTERESTED IN THE PROJECT IN LU'AN (SHANXI PROVINCE). TIAN REPLIED HE HOPED BRITISH COMPANIES WOULD BE SUCCESSFUL: THE COMPETITION WAS QUITE INTENSE.

5.

TIAN EXPRESSED THE CHINESE SIDE'S GRATITUDE FOR BRITAIN'S EFFORTS OVER THE LAST FEW YEARS TO URGE THE US TO CONTINUE TO GRANT MFN STATUS TO CHINA. HE HOPED BRITAIN WOULD CONTINUE ITS EFFORTS SINCE MFN STATUS AFFECTED NOT ONLY SINO-US TRADE BUT ALSO HK-US TRADE. LORD CAITHNESS CONFIRMED THAT BRITAIN WOULD CONTINUE ITS EFFORTS WITH THE US ON CHINA'S BEHALF.

6. LORD CAITHNESS SAID THAT ONE AREA IN WHICH FURTHER EFFORT WAS REQUIRED WAS THE ENVIRONMENT. HE WELCOMED CHINA'S ACCESSION TO THE MONTREAL CONVENTION AS A GOOD EXAMPLE OF SINO-BRITISH COOPERATION. THE PRIME MINISTER WAS PLANNING TO ATTEND THE UN CONFERENCE ON THE ENVIRONMENT IN RIO DE JANEIRO IN 1992 AND HOPED THAT CHINESE REPRESENTATION WOULD BE AT A SIMILARLY HIGH LEVEL.

MCLAREN

YYYY

ΜΑΙΝ

.CHINA TRADE

LIMITED

FED

59

ECONOMIC ADVISERS

DISTRIBUTION

75

RAD

EAPD/ODA

PS/LORD CAITHNESS PS/PUS

PAGE

2

CONFIDENTIAL

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