TNAG-1253-FCO40-1586-Third-countries-and-the-future-of-Hong-Kong-1983 — Page 93

From the Private Secretary

Dear John,

SECRET

DIEU

ET MON

10 DOWNING STREET

HUD

LAPS

PJ/alue PSIPUS

(195)

Sir J. Bullard

4 July 1983

Discussed. Agreed with Private office sand first seek Canberra's newss Tel.

Blu & July,

Pl. speah

Hong Kong

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Had

~ Danald

FED

6/m AMICKO

MKK040/5

NO. 51

12 JUL 1983

POTUISTRY

on Taken

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Planning Stuff Hohes

Mr. Malcolm Fraser called privately on the Prime Minister this morning. I am not recording the full conversation but he made a particular point about China which may be of some interest.

This was

Mr. Fraser said that when the Chinese Premier visited Australia in April he had sought a meeting with him. not just a gesture of courtesy, based on former contacts. had a message which he had clearly meant to be passed on.

The burden of the message was that China was thoroughly frustrated with its relationship with the United States and therefore intended to attempt to strengthen its relationship

Zhao

47.

See 194)

with the Soviet Union. Zhao had said that President Reagan had See 209

broken commitments towards China into which he had entered earlier. The reference appeared to be, in particular, to commitments to transfer technology to China. Although there might have been some movement in this direction, China's formal place on the list of countries who could receive US technology was very low and below India. This appeared to rankle greatly with Zhao.

Mr. Fraser commented that he had had many earlier meetings with Chinese leaders at which they had always been more relaxed about the relationship with the United States. The anti-American element in his latest meeting was new. It would be very dangerous

if the Chinese continued to think that the Americans were so hostile that China's relationship with the Soviet Union must be strengthened. Although Hong Kong had not been mentioned during the talk, Chinese-Soviet rapprochement would not help our task over Hong Kong. Conversely, an improvement in Sino-American relations would make our negotiations with regard to Hong Kong easier.

Mr. Fraser gave it as his view that the practical interests of China in Hong Kong were such that, he believed, they would want a continuing British role in the colony. He observed that Australia's commercial relations with China had developed satisfactorily over a period of 20 years. He had always found the

Lu (201)

SECRET

/ Chinese