Cypher/Cat A
CONFIDENTIAL
PRIORITY HONG KONG TO COMMONWEALTH OFFICE
Telegram No. 495
ONFIDENTIAL
19 April, 1968
TOP COPY
505
Huy
Addressed to Peking telegram No. 175 of 19 April, Repeated for information to C.0.
My telegram No. 487 to Secretary of State: Rice etc.
The China Resources Company (CRC) have already suggested to the Department of Commerce and Industry that the rice should be imported in batches of 1,000 tons provided the entire 5,000 could be brought in outside the Rice Control Scheme. The Department restated our position, explaining that exceptional arrangements had already been made for importation of the gift rice. The CRC may be attempting to exploit the fact that small amounts of relief rice e.g. a few hundred tons, have in the past been brought in outside the scheme. But the Chinese proposal does not meet the basic issue which is that we do not want to allow the CRC to set themselves up as importers of rice outside the normal controls. The Communist Press appears to have dropped the issue for the moment, and has not mentioned CRU's proposal, though two delegations visiting Government department's yesterday demanded immediate importation.
2. It is extremely difficult to think of any further moves we might make to get the Chinese off the hook. We have already given way on the questions of the Chinese quota, delivery, storage, and distribution. If we were to raise our initial offer of allowing 300 tons to come in outside the scheme, e.g. to 500 tons, this would merely encourage the Chinese to pursue their tactic of seeking importation of the whole 5,000 tons in a series of batches in a relatively short period.
3. I should in any case be reluctant to think in terms of further concessions at this juncture, when the Chinese are showing no signs of reciprocity, or even of honouring their side of the bargain on Grey.
F.O. please pass Peking as my telegram No.175.
Sir D. Trench
[Repeated as requested]
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CONFIDENTIAL
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