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CONFIDENTIAL
064716
MDHIAN 1293
BY THE AMBASSADOR. ROY COMMENTED THAT THE AMERICANS WERE SATISFIED WITH THIS RECEPTION. LORD HAD BEEN TREATED CORDIALLY AS AN OLD FRIEND OF CHINA AND THE ATMOSPHERICS HAD BEEN GOOD.
IN
7.
THE MEETING WITH MA ZHENGANG WAS LARGELY A COURTESY CALL. THE MAIN BUSINESS WAS DONE WITH LIU HUAQIU. AT THE PRE-LUNCH MEETING, LORD SET OUT THE MAIN US CONCERNS AND ADDRESSED THOSE OF THE CHINESE. LIU GAVE A PRELIMINARY RESPONSE, WHICH WAS STRONG ON GENERALITIES, AND WEAK ON SPECIFICS, BUT THE TONE WAS GENERALLY UPBEAT. LUNCH WAS DEVOTED TO A FAIRLY BRIEF DISCUSSION OF INTERNATIONAL ISSUES, INCLUDING CAMBODIA AND NORTH KOREA, ON NEITHER OF WHICH THERE WAS ANYTHING MUCH TO SAY AT THAT POINT. THE AFTERNOON LIU RESPONDED TO THE US CONCERNS IN A WAY WHICH THE AMERICANS HAD NOT FOUND POSITIVE. HE CLAIMED THAT THE CHINESE HAD MADE EFFORTS AND WOULD CONTINUE TO MAKE EFFORTS, BUT SAID NOTHING NEW. HE ALSO PUSHED HARD FOR DIALOGUE ON THE CHINESE CONCERNS, PARTICULARLY ON ARMS SALES TO TAIWAN A DIFFICULT ISSUE FOR THE US IN VIEW OF THE LEGAL REQUIREMENTS IMPOSED UNDER THE TAIWAN RELATIONS ACT.
8.
SINCE NONE OF THIS WAS OF MUCH HELP TO THE ADMINISTRATION, LORD TOOK LIU ASIDE PRIVATELY BEFORE DINNER AND SET OUT FOR HIM THE TWO OPTIONS OF CONDITIONALITY THROUGH EXECUTIVE ORDER AND BY LEGISLATION, EXPLAINING WHY THE CHINESE WOULD BE BETTER OFF WITH AN EXECUTIVE ORDER. HE ALSO EXPLAINED THAT IF THE CHINESE WERE UNABLE TO MAKE ANY MOVES WHICH WOULD HELP SWAY CONGRESSIONAL OPINION PRESIDENTIAL CONDITIONALITY MIGHT WELL BE HARSHER THAN WOULD OTHERWISE BE THE CASE. HE EMPHASISED THAT A MOVE ON THE M-11 ISSUE WAS PARTICULARLY IMPORTANT IN THIS CONNECTION.
9.
ON HONG KONG THERE WAS AN EXCHANGE ON STANDARD LINES. LORD EMPHASISED THE STRONG US COMMERCIAL AND ECONOMIC STAKE IN HONG KONG, AND THE US INTEREST IN THE MANAGEMENT OF THE REVERSION TO CHINESE SOVEREIGNTY IN ACCORDANCE WITH THE JD. THE US WERE CONCERNED ABOUT THE DEVELOPMENT OF DEMOCRACY IN HONG KONG BUT RECOGNISED THAT THIS WAS A MATTER FOR BRITAIN AND CHINA, TAKING ACCOUNT OF THE ASPIRATIONS OF HONG KONG PEOPLE, AND WOULD NOT SUPPORT ANY SPECIFIC FORMULA. LIU RESPONDED ON FAMILIAR LINES, CLAIMING THAT US ACTIONS AND WORDS AMOUNTED TO INTERFERENCE IN CHINESE INTERNAL AFFAIRS: AND WARNING THAT CHINA WAS FIRMLY OPPOSED TO INTERNATIONALISATION, AND THAT ANY ATTEMPT BY THE UNITED STATES TO MEDDLE WOULD OBSTRUCT TALKS BETWEEN THE UK AND CHINA AND HARM THE STABILITY AND PROSPERITY OF HONG KONG.
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