TNAG-2242-FCO40-3223-Most-favoured-nation-status-for-China-impact-on-Hong-Kong-1991 — Page 7

CONFIDENTIAL

(e) The Prime Minister should be asked to write to the President, as Mrs Thatcher did last year, at a time to be

advised by Sir A Acland. A draft will be submitted then.

II

Action with the Chinese

(a) We took every occasion over the last 12 months to remind the Chinese of our work on their behalf (and Hong

Kong's) over MFN renewal in 1990. They have been reasonably appreciative. Most recently, Li Peng thanked the Secretary of State in Peking during his visit. He asked for continued UK support this year.

(b) The Chinese have done little or nothing to respond to our help. They have been very difficult over Hong Kong; they have made little attempt to respond on human rights and they continue unacceptable trade practices (it is not only US interests which are affected by intellectual property rights infringements).

(c) We must therefore speak frankly to the Chinese to

engage them in a joint effort to overcome Congressional objections. I attach a draft telegram to Peking and Hong Kong seeking views on how to approach them.

III Action with Third Parties

9.

We should also take every opportunity to engage the support of friendly governments to argue Hong Kong's case with the US and, where feasible, to speak to the Chinese about the need for movement on their part.

G7 partners may already have been sensitised during the

Sherpa / Political Directors meetings in Hong Kong which concluded yesterday;

DUNAFS/4

CONFIDENTIAL