CONFIDENTIAL

participate in any mission to Canton in which CLP was not represented.

He was therefore recommending that we reject the visit to Canton and

tell the Chinese that GEC would only participate in a mission which

included CLP.

Mr Havelock felt that this was the right course of action while at the

same time we had to recognise that Lu Ying does have influence in

Guangdong and in turning down an immediate mission, we must take care

not to cause him a loss of prestige. Mr Paul felt that this should not

be difficult to arrange as we could produce a subtle form of words to

the effect that a mission was "under consideration" or "not appropriate

at this time"; there was no question of an absolute rejection. All

present then agreed that the Chen Gang invitation would stand, but that

an Anglo-US mission to Canton should be avoided.

ACTION

Mr Lippitt asked what further soundings could be made in Peking and

Paris. The visit of the Lord Privy Seal, who was to see Premier Zhao,

was rather fortuitous and further consideration should be given

dependent upon the outcome of that meeting, although it was unlikely

that a politically orientated visit would look at projects in such

detail. It was agreed that Mr Brice would do a note of this meeting

and prepare a summary which could be used as a background note for

Peking, Hong Kong, Washington and Paris and at the same time Mr Paul was

to prepare a Line to Take with the Chinese.

Subject to the views of

Peking and Hong Kong, this Line to Take would also be passed through

Mr Thomson to Lu Ying.

Mr Brice

Mr Paul

With regard to CLP and its suspicion about our activities, it was agreed

that Mr March should inform them as well of the line we are taking with

the Chinese. It would also be necessary to handle our relations with

the AEA, Westinghouse and Bechtel carefully, particularly in

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