TNAG-2469-FCO40-3593-Most-favoured-nation-status-for-China-Hong-Kong-interests-1992 — Page 12

CONFIDENTIAL

ре

18

165175

MDHOAN 5943

CONFIDENTIAL

FM FCO

TO IMMEDIATE HONG KONG

Mud B 091/2

YTOP COPY

-7 JAN 1992

TELNO 1732

ISTRY

IND

OF 151908Z DECEMBER 92

142)

141

Q DIST?

INFO IMMEDIATE PEKING, WASHINGTON, UKREP JLG HONG KONG

YOUR TELNO 2886: WASHINGTON TELNO 2731: AND PEKING TELNO 1735: CHINA/MFN/HONG KONG

1. WE AGREE WITH THE SUGGESTION IN PARA 2 OF FIRST TUR. EXPRESSED IN THIS WAY IT WILL GET THE MESSAGE ACROSS ON MFN WHILE MAKING CLEAR THAT THERE ARE OTHER EQUALLY IMPORTANT SUBJECTS WHICH YOU WISH TO DISCUSS WITH MR CLINTON. WE HAVE SUGGESTED THAT THE PRIME MINISTER MAY WISH TO MAKE THESE POINTS IN HIS TELEPHONE CALL TO THE PRESIDENT-ELECT DURING HIS VISIT TO WASHINGTON FROM 18-20 DECEMBER. BUT WASHINGTON MAY WISH TO FOLLOW UP WITH CLINTON'S TEAM.

2.

IN

IT IS CLEAR THAT THE PRESENTATION OF THE VISIT AND ITS OBJECTIVES WILL NEED TO BE HANDLED CAREFULLY, BOTH IN PRIVATE DEALING WITH THE CLINTON TEAM, AND IN PUBLIC ANNOUNCEMENT. PRIVATE WE NEED TO BE PREPARED TO TAKE FULL ADVANTAGE OF WHAT HELP CLINTON IS PREPARED TO GIVE, BOTH ON THE GOVERNOR'S PROPOSALS AND ON MFN, WHILE REGISTERING THE COMPLEXITY OF HONG KONG'S POSITION. CLEARLY WE MUST DISABUSE ANYONE IN CLINTON'S TEAM WHO MAY STILL THINK IT WOULD HELP US TO MAKE A DIRECT LINK BETWEEN THE GOVERNOR'S PROPOSALS AND MFN RENEWAL. BUT WE SHOULD NOT DISCOURAGE THE AMERICANS ALTOGETHER FROM USING TRADE AS A MEANS OF PLACING PRESSURE ON CHINA. WE WOULD NOT WANT HONG KONG LEFT OUT COMPLETELY FROM ANY US/CHINA DIALOGUE ON MFN. AND THE AMERICANS MIGHT USEFULLY TAKE THE LINE THAT IF THE CHINESE CLAMPED DOWN ON FREE INSTITUTIONS IN HONG KONG IN 1997, THIS WOULD HAVE A VERY DAMAGING EFFECT ON THE PROSPECTS FOR TRADE

ETC.

3.

IN A PUBLIC ANNOUNCEMENT WE AGREE THAT WE SHOULD AVOID THE IMPRESSION IN US EYES THAT THE GOVERNOR IS GOING TO WASHINGTON AS AN APOLOGIST FOR CHINA, BUT AT THE SAME TIME AVOID FUELLING CHINESE PARANOIA ABOUT A UK/HK/US PLOT AGAINST CHINA. WE ALSO AGREE WITH THIRD TUR THAT, WHATEVER PUBLIC LINE IS EVENTUALLY AGREED, WE SHOULD TIP THE WINK TO SOMEONE THE CHINESE TRUST, THAT UNCONDITIONAL RENEWAL OF MFN REMAINS OUR AIM.

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