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057575
MDHIAN 1038
HIM.
FIRST IT WAS ESSENTIAL TO MAINTAIN SOME FORM OF UNION GOVERNMENT WITH POWER OVER FOREIGN POLICY, TAXATION AND THE MILITARY. COORDINATION WAS NECESSARY. FURTHERMORE THE WEST'S AGREEMENTS EG ON DEBT, ARMS CONTROL ETC WERE ALL WITH THE CENTRAL POWER. SECOND THE REFORMERS SHOULD GET TO WORK IMMEDIATELY TO ESTABLISH LAWS ON BANKING, PROPERTY, THE JUDICIAL SYSTEM ETC. UNLESS PROGRESS WAS MADE QUICKLY THE HARDLINERS WOULD BE GIVEN AN OPPORTUNITY TO HIT BACK. THEY WERE STILL POWERFUL IN MANY REPUBLICS. THIRD PRACTICAL ISSUES SHOULD BE TACKLED RIGHT AWAY. PEOPLE EXPECTED THE ADMINISTRATION TO WORK AND PROVIDE THE ESSENTIALS FOR EVERY DAY LIFE. YELTSIN HAD A BIG RESPONSIBILITY. NAZARBAYEV SAID THAT HE AGREED WITH THESE POINTS AND HAD SPOKEN ON THE SAME LINES TO GORBACHEV. MRS THATCHER CHARACTERISED NAZARBAYEV AS A SENSIBLE AND ABLE PERSON WITH SUBSTANTIAL INFLUENCE. HE BOTH WANTED TO BE AND WAS BY NATURE SUITED FOR THE ROLE OF MEDIATOR.
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KAIFU IN HIS REPLY DESCRIBED HOW HE HAD COME TO HEAR OF THE COUP AND HIS LENGTHY EFFORTS TO ARRANGE A TELEPHONE CALL TO YELTSIN. HE AGREED THAT A CENTRAL GOVERNMENT WAS NECESSARY AND NOTED IN PARTICULAR CONTROL OVER NUCLEAR WEAPONS. HE ALSO SAID THAT JAPAN WAS HOPING TO MAINTAIN THE AGREEMENT ON ASSISTANCE REACHED AT THE LONDON SUMMIT. MRS THATCHER REPLIED BY SAYING THAT THERE WAS A NEED NOW TO OFFER PRACTICAL HELP. THE RUSSIANS SIMPLY DID NOT KNOW HOW TO INSTITUTE THE NEW SYSTEMS THAT THEY NEEDED. (COMMENT: THE IMPLICATION WAS THAT THE G7 NEEDED TO MOVE FURTHER FORWARD.) KAIFU NOTED THAT JAPAN HAD PROMISED 100 MILLION OF FOOD AID CAN EXIM BANK LOAN STILL UNDER NEGOTIATION).
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IN ANSWER TO KAIFU'S QUESTION ON HOW ONE SHOULD HANDLE RELATIONS BETWEEN GORBACHEV AND YELTSIN MRS THATCHER SAID THAT IT SHOULD BE HANDLED IT BY TELLING THEM BOTH THAT THE RUSSIAN PEOPLE, HAVING STOOD UP BRAVELY FOR DEMOCRACY, EXPECTED THEM TO TACKLE THE PROBLEMS FACING THE COUNTRY.
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IN A SHORT EXCHANGE ON CHINA KAIFU SPOKE OF HIS EFFORTS AT HOUSTON TO KEEP CHINA INVOLVED IN THE INTERNATIONAL DIALOGUE AND OF THE RECOGNITION OF THIS FACT AT THE LONDON SUMMIT.
HE HAD ENCOURAGED THE CHINESE TO CREATE THE NECESSARY CONDITIONS FOR THIS. HE ALSO EMPHASISED THE IMPORTANCE OF 'FREE ECONOMIC ACTIVITY BEING NECESSARY FOR THE FUTURE SUCCESS OF HONG KONG'. THIS WOULD BENEFIT NOT ONLY THE UK, JAPAN AND CHINA BUT ALSO WORLD TRADE. THE CHINESE HAD FULLY AGREED WITH THIS. MRS THATCHER THANKED KAIFU FOR HIS IMPORTANT SUPPORT ON HONG KONG AND WELCOMED THE FACT THAT KAIFU HAD SPOKEN DELICATELY AND DIPLOMATICALLY ON THE QUESTION OF HUMAN
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