CONFIDENTIAL
02515
MDHIAN 0236.
WOULD VISIT SOON. IT WAS A PITY THAT THE PRIME MINISTER HAD BEEN FORCED TO CANCEL HIS VISIT IN JANUARY. THE JAPANESE HOPED FOR AN EARLY REINSTATEMENT. THEY APPRECIATED THE PRIME MINISTER'S INVITATION TO THE UN SECURITY COUNCIL SUMMIT ON 31 JANUARY. WANTED TO HELP TO MAKE IT A SUCCESS AND LOOKED FORWARD TO A BILATERAL WITH THE PRIME MINISTER IN THE MARGINS.
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JANUARY. MYAZAWA
3. THE SECRETARY OF STATE SAID THE DISCUSSIONS WITH THE JAPANESE WERE ALWAYS USEFUL, ON TWO SUBJECTS ESPECIALLY:
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THE EVOLUTION OF THE EC: BRITISH AND JAPANESE VIEWS WERE CLOSE.
HONG KONG AND CHINA: BRITAIN AND JAPAN SHOULD KEEP TRYING TO . BRING HOME THE REALITIES TO THE CHINESE GOVERNMENT.
4. THE SECRETARY OF STATE SAID THAT THE PRIME MINISTER WAS SAD TO HAVE BEEN FORCED TO POSTPONE HIS VISIT TO TOKYO BUT IN A PRE- ELECTORAL PERIOD IT WAS DIFFICULT FOR HIM TO MAKE EXTENDED VISITS FROM LONDON. THE PRIME MINISTER LOOKED FORWARD TO MEETING MYAZAWA IN NEW YORK ON 31 JANUARY.
CHINA AND HONG KONG
5. THE SECRETARY OF STATE THANKED WATANABE FOR THE HELPFUL MESSAGE AFTER HIS RECENT VISIT TO CHINA. WATANABE SAID HE HAD VISITED CHINA IN EACH OF THE LAST THREE YEARS. DURING HIS FIRST VISIT THE CHINESE GOVERNMENT HAD COMPLAINED ABOUT HONG KONG'S AIRPORT PROJECT ON THE GROUNDS THAT IT WAS TANTAMOUNT TO HONG KONG HOSTING A PARTY WITH SOMEBODY ELSE'S (IE CHINESE) MONEY. WATANABE HAD TOLD THEM THE AIRPORT PROJECT WAS CRUCIAL TO THE FUTURE OF HONG KONG AS THEY WOULD UNDERSTAND IF THEY TALKED TO BRITAIN.
6. WATANABE SAID THAT THE UNITED STATES CONGRESS WAS AGAIN MOVING TOWARDS ABOLITION OF MFN STATUS FOR CHINA. THE WHITE HOUSE WERE WORRIED ABOUT VETOING IN AN ELECTION YEAR. BRITAIN AND JAPAN SHOULD WORK ON CONGRESS TO AVOID ABOLITION OF MFN STATUS, WHICH COULD ONLY DAMAGE THE INTRODUCTION OF MARKET PRINCIPLES IN THE CHINESE* ECONOMY.
7. THE SECRETARY OF STATE AGREED. BRITAIN WAS TALKING TO THE U.S. ADMINISTRATION. MEN STATUS FOR CHINA WAS ALSO VERY IMPORTANT TO HONG KONG. HE WAS GRATEFUL FOR WATANABE'S INTEREST IN HONG KONG AND WANTED TO KEEP PERSONALLY IN TOUCH ABOUT IT. THE SECRETARY OF STATE HAD SPOKEN TO THE GOVERNOR OF HONG KONG IN LONDON THE PREVIOUS DAY. HE KNEW THAT JAPANESE FIRMS WERE BIDDING FOR THE BRIDGE CONTRACT.
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