TNAG-0768-FCO40-972-Supplies-of-electrical-power-for-Hong-Kong-Castle-Peak-power-1978 — Page 200

CONFIDENTIAL

2.

presenting proposals to them;

it is ideas which are now required. Sir Lawrence Kadoorie is correct in supposing that until quite recently no detailed planning has been done. It was perhaps reasonable to wait until December last year, since it was not until them that the Chinese accepted the proposals which

Sir E Youde put forward in Peking in July; but there has clearly been a hiatus since.

5. There have been several reports of Chinese irritation at the lack of progress, and the Commercial Counsellor in London recently said the Chinese hoped Mr Dell would sign an agreement when he goes to Peking. That looks most unlikely, but DOI are urgently preparing some proposals which can be put to the Chinese, just before or during Mr Dell's visit. They will consist of a suggested framework for the operation and a few specific proposals. One of these will be for the transmission line into China. Schroeder Wagg are preparing a detailed proposition to submit, following Mr Dell's visit. This has been done on Sir Lawrence Kadoorie's instructions, with the knowledge of the DOI.

6.

During his introductory call Mr Cradock was told by Vice Minister Ku Ming that one of the ways in which technical exchanges between Britain and China might be promoted was through this compensation deal of coal for mining machinery. Mr Davies has also reported a conversation he has had with the Deputy Director of the Third Bureau of the Ministry of Foreign Trade, Mr An Tung, who said that co-operation on electrical power generation could be included as suggested by Sir Lawrence Kadoorie, as one way of making an early start. At the same time, he said that the way forward really lay in the provision of mining equipment. This is important and proposals for this should be included in whatever is put forward. We should aim to see that they are included during the meeting which is to take place tomorrow afternoon.

18 July 1978

Lachend Samuel にん

R C Samuel

Far Eastern Dept

CC:

Mr Cortazz

HKGD

TRED