CALL ON MR GOODLAD BY LORD GEDDES, MONDAY 17 MAY, 3.30

UK/China Trade

Points to Make

- Bilateral relations understandably dominated by Hong Kong. But

no reason why difficulties over that issue should adversely

affect other aspects of the relationship, whatever the Chinese

may say. No evidence (except Jardines) of discrimination against

British companies.

- UK industrial capabilities fit well with China's priority

sectors:

transportation, telecommunications, power generation

and agriculture and food processing. Coupled with China's strong

growth and the accelerated pace of reform, good prospects for

British exporters of goods and services.

UK exports to China in 1992 were £430m an increase of 33.5%

over 1991. UK performed less well both in value and in share of

the market when compared to exports by our European competitors.

Imports have grown steadily to £954m in 1992 an increase of 34.9%

over 1991. Recent UK export successes include an order for 8 BAe

146s (£97m), Rolls Royce aeroengines (£300m), the Shajiao C power

station (GEC Alsthom £300m) and a PTA plant (Foster Wheeler

£70m).

Visits

Despite the high-decibel Chinese protests over Hong Kong in the

last quarter, 1992 was a good year for high level contacts. The

Prime Minister met Li Peng in New York and in Rio. Mr Needham

visited twice and again in January 1993. Vice-Premier

Zhu Rongji, Foreign Minister Qian Qichen and the Mayor of

Shanghai all visited UK.

- Mr Heseltine will visit China (cancelled last October) in

callgeddes 1405

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