CONFIDENTIAL
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interference and, provided it remits to the state each year a fixed sum, is allowed to manage its affairs as it wishes and to keep any surplus it makes. It therefore has an incentive to be
energetic, and has entered into technical cooperation agreements with a number of western
firms. It now deploys state-of-the-art technology, and has achieved encouraging sales both
locally and overseas. The central government should reflect on the company's success, and
draw the obvious conclusion.
89.
Although the mayors and senior officials of both cities clearly intended to
receive us with due courtesy, we had to endure a number of petty irritations from other
parts of the administration, the more prominent example being the incident at Qingdao
Airport mentioned in para. 18 above. If these sort of obstructions were placed in the way
of an official delegation known to be visiting the mayor, many potential overseas investors
could expect similar treatment, which would do nothing to endear them towards investing
in Qingdao. China in general has a great deal to learn about impressing visitors, but minor officials in the north, who have so far had the least contact with foreigners, appear to be more trying than their southern counterparts.
Industry Department
27 November 1991