TNAG-0034-FCO40-70-Relations-with-China-1968 — Page 21

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general terms" on Tuesday/Wednesday, but had not mentioned Grey by name and had referred to him (among others) only as the "Reuter correspondent". I asked whether he had written to Small LEUNG again as agreed over the weekend:

he confirmed that

he had, and this time had specifically mentioned Grey.

5.

Jay wanted my advice as to what he should say to LI to-morrow. I suggested that he should say no more than what we had agreed on Saturday, i.e., he had spoken to me about the possibility of an exchange of HSUEH Ping for Grey: that I was not very keen etc., etc., but would consider it. Jay immediately said that he had already appraised LI of this. I expressed surprise at this, and said that it was my understanding that Jay would be delaying reporting any of this to LI for some time, at any rate for a few days, thus giving time for Small LEUNG to respond to his message. Jay said "Oh, I happened to speak to

LI over the weekend".

6.

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This

Returning to the matter in hand, Jay asked what further information he could now give to LI. I suggested that it would be entirely reasonable for him to say that I still had the matter under consideration and that he, Jay, would be taking me up on this in a few days' time. Jay was most anxious, however, to say something more specific and wanted to know whether in fact he could say that a "swop" for HSUEH Ping would be approved. I said that he should go no further than I had suggested. matter was to be raised many times in almost precisely the same terms during the next hour's conversation. At one time, Jay expressed great concern that possibly I was disappointed in, or annoyed with, him for having made the counter proposal (to contact LEUNG) rather than to pass on my enquiry concerning a possible exchange of HSUEH/Grey. I immediately reassured him that this was not the case: indeed, so impressed was I by his comments and proposal, that I at once agreed with him. He then went into a lengthy discourse on what his position might be in the future vis a vis the Hong Kong Government. He knew, for example, that the Governor was going on leave in mid-October and, if I were to be transferred (?) then it would leave him in a very exposed position. He dragged up the old question again of the S.B. surveillance and, rather forlornly at one stage, commented that the Communists did not know that he was a British Subject and that in any event they would probably not worry about him in the future.

7.

Jay speculated as to what the Peking message might be, and wondered what the position would be if Peking had said that they were not interested in obtaining an exchange for Grey: would this not upset everything, and would it not mean that his proposal and action had merely worsened the situation? I pointed out that this was certainly not the situation: even if Peking were not to show specific interest at the moment, the way would be clear for us to come back in a few days' time and say that we had considered K.C. Jay's proposal and would like it taken up specifically with Peking. It seemed to me that the options

would still remain open to us.

8.

He asked for precise instructions as to what he should do at the meeting with LI to-morrow. I said (rather obviously, perhaps) that he should listen to what LI had to say. Then, if

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