TNAG-1622-FCO40-2236-Relations-between-Hong-Kong-and-China-1987 — Page 220

CONFIDENTIAL

ANNUAL REVIEW:

CHINA

SUMMARY

014/1

BRITISH EMBASSY,

PEKING.

1.

In January 1987, Hu Yaobang was sacked as General-Secretary of the Central Committee and a campaign was launched against "bourgeois liberalisation". Many judgements about these events cannot yet be made.

(Paragraphs 1 - 3)

2. Deng Xiaoping and his associates still want to build economic efficiency, political community and autonomous institutional

strength into Chinese society.

(Paragraphs 4 and 5)

3. The Chinese economy performed only moderately well in 1986.

Economic reform was taken further.

(Paragraphs 6 and 7)

4. The Soviet Union tried to break the ice in Sino-Soviet relations, but without much success. There was change in China's relations with other countries of Eastern Europe. The situations

in Korea and Taiwan became more difficult for China.

(Paragraphs 8 - 12)

5. Her Majesty The Queen paid a very successful State Visit to China in October. We did well over Hong Kong (though 1987 will be a difficult year), trade and cultural relations.

6.

(Paragraphs 13 - 17)

The campaign against "bourgeois liberalisation" is not to be seen as a return to the politics of the Cultural Revolution.

CONFIDENTIAL

(Paragraph 18)