CONFIDENTIAL
liberalism may allow ideology to play a new part in foreign affairs, although the leadership have been at
pains to say that policies will remain unchanged.
9. The principal development in 1986 has however been
the growing momentum in her relations with the USSR.
Although the relationship has not yet developed into full
political or Party links, the warmth in the relationship
is greater than China herself admits, though not as significant as the USSR claims. There is nevertheless the potential for substantial improvement, particularly as the USSR herself becomes more pragmatic, and less wedded to the notion of Soviet socialist supremacy.
Deng Xiaoping may be somewhat anti-Soviet, but he dislikes Russia's cant and over-weening self-importance
as much as her historical treatment of China.
10.
Chinese relations with the US maintained a steady,
level course over 1986. There is arguably less scope for improvement (other than on technology transfer, which the
US will wish to limit) than there is with the Soviet
Union. But the maintenance of good relations is important to China, and is helped by her willingness to
take a long-term view on regaining Taiwan. China's public criticism of the US over Taiwan has often been a product
of the need from time to time to criticise America for
something, rather than any calculated intention to let
the Taiwan issue take precedence over the bilateral
relationship. This may however change. Growing Taiwanese nationalism may mean that time is no longer on
China's side.
FC4AAK
CONFIDENTIAL
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