TNAG-2978-FCO40-1470-Trade-relations-between-Hong-Kong-and-the-UK-1982 — Page 46

CONFIDENTIAL

2

DSR 11C

financed contracts, in view of the Bank's requirement for

international competitive bidding.

Sources of Tension

4.

5.

The UK is most obviously at risk where:

we are forced to confront awkward choices in regional

conflicts such as the Arab/Israel dispute or Southern

Africa or have backed the wrong side in Civil wars and

revolutions.

There are historic bones of contention, as with Argentina

over the Falkland Islands.

Domestic political and economic priorities prevail over

British overseas interests, as with the recent increases in

overseas student fees, aid cuts, the nationality bill,

civil aviation disputes and our support (see Appendix 'A'):

for protectionist policies within the EC.

More difficult to predict and control are strains arising

where:

-

Poor or improper performance by British-controlled multi-

national corporations provokes a host country.

Private bodies or individuals beyond governmental reach

exercise regulatory powers (as in London's financial or

commodity markets) or become involved in activities (for

example in sport or the arts) that provoke a host country.

Personal offence is taken by LDC leaders or ministers over

seemingly unimportant official or unofficial acts, or at a

supposed failure to grant what they regard as proper respect

during visits to the UK.

The UK media report critically on a Third World country or

its leaders.

Nothing in this list is new (and the threat of discririn-