TNAG-1711-FCO40-2389-Future-British-Consulate-General-in-Hong-Kong-HMS-Tamar-1987 — Page 20

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CONFIDENTIAL

closer relations with developed countries to help carry

forward the modernisation programme, principally through

imports of advanced technology. Despite the lack of

diplomatic relations, trading links are being strengthened

with Singapore, Indonesia and South Korea - and even Taiwan.

In seeking the reunification of Taiwan with the mainland the

Chinese have become increasingly committed to using peaceful

means. There has been a gradual improvement in relations

with the Soviet Union, but the relationship is unlikely to

develop any real warmth unless the Soviet Union is prepared

to remove what China sees as the "three obstacles" to

Sino-Soviet relations: Soviet backing for the Vietnamese

occupation of Cambodia; the Soviet presence in Afghanistan;

and the reduction of troop levels along the Sino-Soviet and

the Sino-Mongolian borders.

5. There are signs that closer contacts with Japan and the

West have increased the material expectations of the Chinese

people and stimulated interest in Western concepts of

freedom, democracy and human rights. Internal political

life is no longer characterised by class struggle. But the

regime remains centralised and authoritarian and in January

1987 launched a campaign to counter support for a pluralist

political system or for the emergence of capitalism

(bourgeois liberalisation) on a significant scale.

6. China's modernisation policies are closely associated

with Deng Xiaoping, now aged 82. Deng has secured the

appointment of a Party Central Committee largely favourably

PR6AAJ

CONFIDENTIAL