TNAG-0741-FCO40-945-Relations-between-China-and-Hong-Kong-1978 — Page 138

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DSR 11C

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to a significant improvement in Chinese military

capabilities should not, however, be under-estimated.

Such sales would be interpreted as a deliberate anti-

Soviet act, and would be cited by the Soviet leadership

to help justify both for internal and external

purposes any eventual shift in Soviet policies

towards the West. In the shorter term there could

be adverse consequences for Anglo-Soviet political

relations (reflected, for example, in the frequency

and friendliness of Ministerial visits) and for UK

commercial interets in the USSR (see paragraph 38 above)

(c) Helping to improve China's defence potential

and industrial base will make it easier for her to

influence countries in the Third World, for example

by offering larger scale military as well as economic

assistance. This could be to the West's detriment,

although it could also usefully counter Soviet

influence. But as a rising industrial power China

will in any case be in a position to provide the kind

of military assistance many Third World countries are

likely to want regardless of Western defence sales

policies. Good trade will in fact do more to build

up China's political power than defence sales.

(a) A militarily stronger China would be better

able to give military help to, eg, North Korea, but

this would carry with it a greater influence over

North Korean policies, at the expense of the Soviet

Union and in favour of regional stability.

should be helpful to the West.

This

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