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MDHIAN 396
THE SAME TIME ANNOUNCE CONDITIONS FOR RENEWAL NEXT TIME ROUND (JUNE 1994). THE CONDITIONS WOULD REQUIRE THE CHINESE TO MAKE PROGRESS IN THE ABOVE AREAS. SUCH AN APPROACH WOULD PROBABLY BE ACCEPTABLE ON THE HILL WHICH, IN LAST YEAR'S BILL, GAVE THE CHINESE A YEAR'S GRACE TO IMPROVE THEIR PERFORMANCE.
6.
NSC TOLD US ALSO THAT THE KEY TO AVOIDING A SHOW-DOWN WITH THE CHINESE CAND TO MINIMISING THE IMPACT ON HONG KONG) WOULD BE TO DEVISE CONDITIONS WHICH WOULD NOT IMPOSE TOO ONEROUS A BURDEN ON THE CHINESE. THIS WOULD LEAVE OPEN THE POSSIBILITY OF THE CHINESE DOING ENOUGH TO EARN RENEWAL IN 1994.
7.
NSC ADDED THAT THE PRESIDENT WOULD PROBABLY PREFER TO SET CONDITIONS HIMSELF, RATHER THAN LEAVE CONGRESS - WHICH WOULD TAKE A HARDER LINE TO MAKE THE RUNNING. THIS WOULD GIVE HIM MORE FLEXIBILITY TO DECIDE WHETHER THE CHINESE HAD MET THE CONDITIONS IN 1994. AS WE HAVE REPORTED, ONE IDEA WAS THAT HE MIGHT ISSUE AN EXECUTIVE ORDER, BUT SOME OFFICIALS HAVE RECENTLY SUGGESTED TO US THAT IT WOULD BE PREFERABLE FOR THE PRESIDENT SIMPLY TO SPECIFY CONDITIONS IN A POLICY STATEMENT WHICH WOULD GIVE HIM EVEN MORE FLEXIBILITY IN 1994.
8. OUR CONTACTS SAY THAT THE ADMINISTRATION HAS JUST BEGUN ITS REVIEW OF CHINA POLICY. THIS COULD TAKE ABOUT A MONTH.
RENWICK
YYYY
DISTRIBUTION
75
MAIN
73
.MFN AND HONG KONG HKD
RAD
EASD/ODA
ECONOMIC ADVISERS
PS
ERD
ESED
FED
JOINT DIRECTORATE
NAD
NEWS D
PS/MR GOODLAD
PS/PUS
SIR J COLES
MR CROWE
MR MILES
MR HUM
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