TNAG-0743-FCO40-947-Relations-between-China-and-Hong-Kong-1978 — Page 215

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The Prime Minister went on to say, on the subject of relations with third countries, that he had been given a report of what Mr. Huang had said to Dr. Owen that morning. He dit not share Mr. Huang's pessimism and thought that he might be underrating the defensive capacity of the West. The Prime Minister said that his own view was that the West was capable of handling the threats which confronted it although he fully acknowledged the recent increase in the military capacity of the Soviet Union and there was no disposition to be complacent. The UK would continue to develop her relations with the Soviet Union and to pursue detente; the UK saw no advantage in any trend in relations which could heighten tension. The UK's enhanced relations with China would not, therefore, affect her relations with the Soviet Union.

In

a number of fields, the UK looked forward to a deepening relationship with China, for example in the field of education on which

Mrs. Williams had given him a report following her visit to Peking. The UK also wished to deepen commercial relations with China:

the Prime Minister referred to his friend in Hong Kong, Sir Lawrence Kadoorię, who kept him informed of his activities in developing trade between Hong Kong and China in the fields of coal mining and power generation. The Prime Minister told Mr. Huang that his present visit was a harbinger of the deepening relationship between

China and the UK. He understood that Premier Hua Kuo-feng was

thinking of paying a visit to Europe: if he did so, he would find a very warm welcome in the UK and the Prime Minister hoped that

he would come.

Mr. Huang recalled that Dr. Owen's predecessor, Mr. Crosland, had visited China in May 1976 and that Premier Hua had told him that the Prime Minister would be very welcome in China. Mr. Huang said

that he would like to reiterate, on Premier Hua's behalf, the

invitation which had been extended and to express the hope that

Mr. Callaghan would visit China as soon as it was convenient for

him to do so. The Prime Minister said that it should have been

he, rather than Mr. Crosland, who visited China in 1976; his wife had been very disappointed when he had been elected Leader of the Parliamentary Labour Party! Mr. Huang would, however,

understand that there was a difficult Parliamentary situation

in the UK which made it hard for Ministers to leave the country

it was much easier for some other Heads of Government to pay visits

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