TNAG-0840-FCO40-1049-Relations-between-Hong-Kong-and-China-1979 — Page 37

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CONFIDENTIAL

5. Our principal objectives for the visit will be to impress Hua with Britain as a stable and prosperous society, and as a source of top-level industrial, agricultural, energy and defence equipment and technology; to establish at the highest level a productive and understanding relationship between China and Britain; to encourage the Chinese Government in general to play a more active and responsible role in international affairs; to probe Hua's views on relations with the Soviet Union and to put our own views to him; and to influence his thinking on other issues, particularly those of special concern to us (eg Southern Africa).

6. The Prime Minister should also be advised to discuss Asia, particularly Indochina, and China's role in the area; trade and defence sales; and Hong Kong. A number of other bilateral issues could also usefully be raised briefly.

7. We would not expect the Chinese to want a detailed formal agenda, but we would need to agree with them on the main topics to be discussed, with the bilateral issues to be covered in the Second Session. We would expect that the Prime Minister would wish that, in addition to the Foreign and Commonwealth Secretary, the Secretaries of State for Trade, Industry, and Defence should be present for the Second Session. There may also be parallel talks with Foreign Minister Huang Hua, and possibly (on economic subjects) with Vice Premier Yu Qiuli, whose position as Minister in Charge of the State Planning Commission gives him particular influence on decisions affecting the Chinese economy, externally as well as internally.

8. The Soviet Union will be watching Hua's visit with close attention. Although the Chinese and the Russians have agreed to start talks about their relations in September, those relations are likely to remain hostile. The Chinese may well hope that Hua's visit to Western Europe this autumn will in effect "play the European card" against the Russians by encouraging the view that there exists a form of tactical, anti-Soviet alliance between China and Western Europe. This is a point on which the Russians have shown themselves to be extremely sensitive and they will be watching for any sign that the West Europeans, and the United Kingdom in particular, are willing to side with China against Russia. We should therefore tare care to avoid public statements during the visit which might unnecessarily damage our relations with the Soviet Union, which are currently somewhat improved.

I enclose at Annex A a List of suggested objectives for the visit, and at Annex B a list of suggested briefs.

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CONFIDENTIAL

Milan

Michael Palliser