BRITISH-GERMAN SUMMIT, 25 NOVEMBER

CHINA

POINTS TO MAKE

- Understand you have just returned from China. Grateful for

your assessment of current political and economic situation.

-

- Like you, we are giving higher priority to Asia not just in commercial but in political terms. My own visit to Japan and Malaysia one example. In a speech in Tokyo I outlined our new policy. APEC leaders' meeting in Seattle is a first sign of new regional coherence. Important for Europe to register its interest.

- China's remarkable economic growth (average 8-9% since 1978)

one key factor in all this. Gives China new international

weight. But problems over human rights, proliferation

of course Hong Kong.

- West needs coherent policies in response.

and

Do not suggest we

gang up, but for example we should not let commercial rivalry blunt our political messages.

Greatly welcome the lead now being taken by US Government in

Clinton's policy of engagement.

positively to that overture.

fed13/CH.BRIEFS/pm.gersum.1511

Crucial for China to respond

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