TNAG-2348-FCO40-3417-Political-relations-between-Hong-Kong--China-and-Canada-1991 — Page 36

CONFIDENTIAL

We

that their needs should not be overlooked. We needed to consider how to carry forward the dialogue after the Summit. needed some on-going mechanism, but the US were not keen on anything which was in the framework of the G7. Mr Mulroney commented that he was pretty sure that if the Prime Minister put together a plan, even if it involved G7, and presented it to Bush as the 'Major Plan', Bush would accept it. He, Mulroney, was prepared to work on the Germans.

The Prime Minister said we would need to work out how to link the question of aid to the Soviet Union with Soviet arms production. It was right to pose the question, but if we made the link too explicit Gorbachev might not be able to deliver. Mr Mulroney said that President Bush had focused on this aspect in their recent meeting. Bush could not get the agreement of Congress to help the Soviet Union when Gorbachev was busy refurbishing his weapons systems. Cuba was another neuralgic point. The Soviet Union was belly-up, but was still willing to provide aid for a decrepit old dictator. If Gorbachev did not understand the politics of that, then we really were in trouble. When Gorbachev had visited Ottawa, Mulroney had taken him to the window of his room from which, on a clear day, you could see as far as up-state New York. He had told Gorbachev that the US/Canadian border was 6,000 miles long and that there had not been a single soldier on the border for 175 years. If the US had aggressive intent, did Gorbachev not think that they would have taken over Canada a much more attractive proposition than the Soviet Union? The fact that the United States had lived amicably with Canada for all those years said something about US psychology, and also explained why Americans could not understand the continued Soviet arms build up.

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Mulroney had also found that Gorbachev clearly thought that Canadian and American farmers had some innate superiority compared with Soviet farmers. Mulroney had said that the simple difference was that they owned their properties and loved and cherished the land and worked from dawn to nightfall to be able to pass a prosperous farm on to their children. The difference between Saskatchewan and the Ukraine was not a difference in people, but a difference in ownership. The Prime Minister agreed that the state of the Soviet economy and the difference of mind- set, were such that it was hard to see them pulling through economically.

Hong Kong

The Prime Minister thanked Mr Mulroney for Canada's support over the airport and for the prompt welcome for the Airport Agreement. Mr Mulroney said that when he had recently visited Hong Kong he had found morale really low. The Airport Agreement would give morale a real boost.

Follow-up

I should be grateful for a draft letter to Commonwealth Leaders on Trinidad Terms if this aspect of the Summit goes well. If it does not, we shall need to take stock and decide if it is still worth writing.

CONFIDENTIAL