CONFIDENTIAL

reaction needs to be set against the considerable potential value of the sale which Moral Consultants estimate at £20 million initially.

10.

If we did find that Chinese reactions were becoming

unmanageable, it would be within our

power to refuse an Export

Licence (although it would obviously be awkward to do so).

We

would, if we were to approve the AWP application, insist that the

companies involved avoided publicity of the sales, which would

further reduce risk to HMG.

HD LAS U

H

HLI Davi es

CONFIDENTIAL

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