TNAG-2049-FCO40-2919-Visits-by-Lord-Caithness--Minister-of-State-for-Foreign-and--1990 — Page 72

Background

References

A. Peking telno 1234

B. Peking telno 1262

CHINA: IRAQ/KUWAIT

1.

Chinese interests

Political

China

Good but not particularly close relations with Iraq. has recently established diplomatic relations with Saudi Arabia which it will not want to jeopardise.

political/military links with Egypt.

Nationals

Close

5,000 in Kuwait, 5-7,000 in Iraq (mostly engineering and construction workers). Now evacuating from Kuwait. Suspended air services to Iraq.

Trade

Chinese exports to Iraq: $68m (to Kuwait $134m) Chinese imports from Iraq: $85m (from Kuwat $58m) Iraq's debt to China believed to be around $500m.

Military Trade

Substantial military sales to Iraq (including F7 fighters, tanks, small arms). Continuing minilary equipment

technology transfer/cooperation.

aproximately US$500-750m pa.

Military trade valued at

2.

Bilateral Action

Secretary of State called in Chinese Ambassador on 20 August

(President Bush has written to Chinese President).

BUSAIL/2