TNAG-2291-FCO40-3300-Relations-between-Hong-Kong-and-Taiwan-1991 — Page 110

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we may on the strength of this argument show a little more

flexibility over indirect sales than we allow ourselves where the

end-user is the Taiwan navy.

7. FBM Marine: Protector 33 Fast Patrol Boats

This proposal, for the sale of 33m (92 tonne) patrol boats,

offers several alternative routes of supply. These boats are

clearly suitable for the stated purpose. No-one could sensibly

argue that 33m patrol boats are in the same league as frigates, the

proposed sale of which caused problems for the French in 1989.

Nevertheless, the case is not sufficiently clear-cut to be sure that

a direct sale would escape PRC protest. There is, however, a case

to be made for adopting option (iii) (manufacture under licence in

the US by Marinette Marine, Wisconsin) as an acceptable compromise,

even though the licensing agreement does not appear to fill our

usual requirements for an overtly military sale, since the US

company has built boats only for the US Army and for Taiwan. The

licensing agreement would provide some degree of cover for the UK

involvement, in addition to which we should insist that there should

be no publicity to link the boats to a UK supplier. Provided that

we also stipulate that no weapons systems should be included in the

technology transfer, we should be able to argue, if challenged, that

the boats are clearly intended for marine police work by a

non-military agency, the necessity of which must be clear to the

PRC, and not for defence purposes. I recommend that we

application on these conditions.

8.

A + P Appledore: Peacock Class Patrol Boats

approve the

This application differs from the previous example in

significant ways. First, 60m (660 tonne) boats are much more

substantial than 33m boats. As the brochure shows, they can carry

significantly heavier armament. We could not plausibly argue that

these boats are of negligible military significance, since they were

designed for use by the Royal Navy in Hong Kong. Second, the

proposed collaboration with the French shipyard offers little if any

cover and the product is recognisably of British origin. We would

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