RESTRICTED
03 17
MDLIAN 6061
US OF PRISON PRODUCTS.
COMMENT
5. THE CHIEF FACTOR IN ALL THE ABOVE ACTIONS IS THE LIKELY EFFECT
ON THE MFN DEBATE. THE DECISION WAS TAKEN BY THE PRESIDENT PERSONALLY. ALTHOUGH SOME (MAINLY STATE DEPARTMENT) HAD ARGUED THAT THE CHINESE HAD OFFERED ENOUGH RECENTLY ON TRADE AND OTHER ISSUES (EG NON-PROLIFERATION) TO JUSTIFY CONTINUED INFORMAL NEGOTIATIONS, MOST (INCLUDING WHITE HOUSE) JUDGED THAT VISIBLE FORMAL ACTION AGAINST CHINA WAS ESSENTIAL TO RETAIN SUPPORT FOR MEN BY THE BAUCUS GROUP OF SENATORS. BAUCUS HAD PUBLICLY THREATENED TO DEFECT IF SECTION 301 ACTION WERE NOT STARTED. THE ADMINISTRATION NOW HOPE THAT THE 301 AND CUSTOMS SERVICE ACTION WILL SUFFICE: BAUCUS HAS WELCOMED TODAY'S ANNOUNCEMENT AND INDICATED THAT HE WILL
CONTINUE TO SUPPORT MFN FOR CHINA.
6.
WE ARE DISCUSSING WITH HEAD OF HKETO POSSIBLE FURTHER UK/HK CONTACTS WITH THE US ADMINISTRATION IN THE SPECIAL 301 CASE AND
WILL OFFER ADVICE
RENWICK
SHORTLY.
YYYY
DISTRIBUTION
69
ΜΑΙΝ
68
LIMITED
NEWS DEPT
HKD
PS
FED
NAD.
PS/LORD CAITHNESS PS/PUS
ERD
SIR J COLES
JOINT DIRECTORATE
MR BAYNE
EAPD/ODA
MR MILES
ESED
RAD
MR BURNS
ADDITIONAL
DTI/ASH HSE
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