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Chinese as well on other areas: we should try to

resume meetings of the JLG and the Airport Committee. A meeting between the Secretary of

State and Qian in Europe in May would be useful to maintain a broader dialogue with China and to seek to put the dispute over electoral issues in perspective, emphasising the need for cooperation

in other areas. Unofficial channels may well continue to be useful for signalling key points

and sounding out Chinese thinking.

Maintain the policy of discreet

internationalisation. High profile intervention by President Clinton or Congress, particularly if it dragged in MFN, would be a distinctly mixed blessing. But the Governor's visit to Washington in May will be a timely reminder to Peking of the US dimension, even if statements of support are low-key. However low-key, there is a danger of

over-reaction from the Chinese, who may see the

Governor's meeting with President Clinton as our most significant piece of internationalisation so far. We should also keep Japan, Australia, Canada and EC partners briefed. China is well aware of the need for a benign international image if she is to secure the 2000 Olympics, and would not want the GATT process even further

delayed. None of these levers can be relied on

to induce a rational Chinese response on a sovereignty-charged issue like Hong Kong. But they have some cumulative impact.

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