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136272 MDLIAN 4836

9.

The economic lure of China is proving too strong for the French. German success there has accentuated their feeling that they need to normalise Sino/French relations as quickly as possible (although they are privately disparaging about what the Chinese gave Kohl, pointing, for instance, to the heavy German financing required for the Canton metro contract). But the Chinese appear in no hurry and may still hope that they can block the sale of arms for the frigates.

10. Against this background the French are not going to help us much in our efforts to reverse the collapse of the EU consensus measures against China. On the other hand, given their relations with the Chinese, they would not be graced with a visit by Jiang Zemin, so they might see some advantage in discreetly lending us a hand in trying to impose some constraining discipline on the Twelve.

MALLABY

YYYY

ΜΑΙΝ

122

DISTRIBUTION

134

.CHINA POLITICAL

FED

LEGAL ADVISERS

PUSD

INFO D//BRIEFWRITERS

CONSULAR D

CRD

EASD/ODA//MR MOSSELMANS

EASD/ODA//MR MCCLEAN

ECD (E)

ECONOMIC ADVISERS

CFSP UNIT

ERD

HKD

HRPD

JOINT DIRECTORATE

NEWS D

PLANNERS

WED

PS

PS/BARONESS CHALKER

PS/MR GOODLAD

PS/MR HEATHCOAT-AMORY PS/PUS

MR LANKESTER MR APPLEYARD CHIEF CLERK SIR J COLES MR AINSCOW

MR ALSTON

SIR M BURTON

MR GREENSTOCK

MR HUM

MR BONE

MR KERBY

MR MASEFIELD

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