CONFIDENTIAL
With the agreement of the Governor and ExCo, Mr Goodlad called in Ambassador Ma on 31 March to underline that we remained ready to have talks on electoral issues, on the basis of the draft joint announcement proposed by the Chinese side at the beginning of March (this says nothing about the question of participation in the talks: it was the Chinese side's efforts to reopen this issue which led to the earlier breakdown of talks in Peking). We hope that, with the NPC meeting out of the way, it will be possible to finesse the issue of participation in a way which protects our point of principle and which would allow talks to begin soon. We will be discussing tactics further with the Governor, who returns to the UK on 2 April.
On British commercial interests in China, the general threats made by the Chinese Minister for Foreign Economic Relations and Trade during the NPC meeting seem to have been warnings rather than the start of a campaign. Some British companies have claimed that contracts have been steered away from them on political grounds. But in the last week, GEC (who have long-standing links in China) have won two major contracts.
I am copying this letter to Melanie Leech (Cabinet Office).
(Private Secretary)
CONFIDENTIAL
psno101.4
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