VISIT TO CHINA BY RT HON SIR EDWARD HEATH

DEVELOPMENTS IN CHINA

CHINA POLITICAL

1. In the three years since Tiananmen there has been a

continuing power struggle, of greater or lesser intensity,

centring on how far and how fast economic reform can proceed

without threatening the leading role of the Communist Party in

Chinese political life. The collapse of the Soviet Union and of

socialist regimes in Eastern Europe has brought reformers,

conservatives and pragmatists alike, to accept the necessity of

meeting the economic expectations and demands of the population

in order to maintain political stability and avoid social unrest.

Recent debate has centred on the speed and extent of reform, the

emphasis that should be placed on ideology and how the new China

should present itself both domestically and internationally.

2.

The 14th Party Congress, expected in October, may well see

changes in the Politburo and the Standing Committee. Premier Li

Peng's position is considered under threat. Following the

Congress it should be possible to determine the balance of power

within the Party. At present, it appears that the "paramount

leader" Deng Xiaoping and the reformers are in the ascendant.

3. When Deng made his trip to South China and the Special

Economic Zones (SEZs) of Shenzhen and Zhuhai in February of this

year, he called for a speeding up and deepening of the reform

process. At the time, Deng's visit the first occasion he had

been seen in public for some months was interpreted as a sign

of weakness, an indication that there was no other senior figure

prepared to act for him. However, Deng's message has been spread

and acted upon throughout China and even confirmed hardliners

such as Chen Yun, Chairman of the Central Advisory Commission,

have spoken out in support of economic reform.

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