CHINA: RELATIONS WITH THE UNITED KINGDOM

HL Deb 06 December 1978 vol 397 cc139-226

4.1 p.m.

Debate resumed.

Lord MACKIE of BENSHIE

My Lords, I rise to speak in this debate, mainly because I was asked by the noble Lord, Lord Rhodes, to be a member of his delegation to China. I speak first from these Benches because my noble friend, who is our spokesman on foreign affairs, was a member of a delegation to China led by Lord Chalfont and, with his customary diffidence, my noble friend Lord Gladwyn does not wish to speak before Lord Chalfont.

I am very grateful to the noble Lord, Lord Rhodes, for asking me to go to China and also for initiating this debate, because it gives me a chance to say how well he did and how suitable he was to lead a Parliamentary delegation. The Chinese adored the noble Lord, Lord Rhodes, because they respect great age and also because they respect warriors. The noble Lord is very much both. I remember the very interesting and impressive interview which we had with Li Hsien-nien, a Vice-Premier of China. We sat in the customary circle. The noble Lord, Lord Rhodes, was sitting beside the Vice-Premier, who is a man of 70—a young fellow who had been on the Long March and who is also a warrior. Looking at them, I found it very difficult to distinguish between them. They were obviously getting on like a house on fire. The more people like the noble Lord, Lord Rhodes, who go to China, the better chance we shall have of reaching an understanding which will lead to a more settled world and to prosperity for ourselves in association with China.

I intend to give a personal impression of our visit because it is relevant to the subject. There were four Peers and six Members of the House of Commons on that delegation. None of us had been to China before, and it hit us like a bludgeon. It was quite extraordinary. One knows that the figure of 900 million is an estimate of the number of Chinese, but you do not appreciate what this means until you see them all coming at you on bicycles in the streets of Peking.

There were various incidents during our stay which are illustrative of the size of their problems. We were taken to see the great bridge—which was finished about 10 years ago—over the Yangtze River, which separates the North China plain from South China. I was a little bored; I thought, "Looking at bridges is not very interesting". This enormous bridge carries both rail and road traffic. Everything about it was explained to us. In a rather bored manner, I asked how far up river was the next bridge, and our guide said that it was at Wu-han. So I asked him how far up river that was and received the electrifying answer that it was a thousand miles up river. That is more than the whole length of our country.

Incidents like this brought it home to us that enormous problems are being solved. Before the Chinese built this great bridge they had a train ferry; 18 trains a day went across that great waterway. When we were there, they were pushing over 160 trains a day at a speed which, frankly, horrified me. The whole bridge appeared to shake. However, 160 trains a day compared with 18 represents an enormous increase in traffic. To that has to be added a great amount of road traffic. One could see that the problem was being tackled, despite the fact that when they were in the middle of building the bridge the Russians withdrew their technical assistance and advice. Nevertheless, the Chinese carried on themselves and solved the problem.

We were taken, as all tourists are, to the Great Wall. We thought that it was a very fine wall. Then, all of a sudden, it hit us that it did not stretch, like Hadrian's Wall, for 60 or 70 miles but that it stretched for thousands of miles and that the people of China, without modern technological aid, had built this wall some thousands of years ago. All this made the required impression upon us. It made us aware that we were looking at a phenomenon which is very little understood in this country.

As this House knows, I am a farmer. I had read and heard a great deal about the agriculture of China. On our arrival, we boarded a train at Hong Kong, on the border, and went to Canton. Our journey took us through irrigated agricultural land the like of which I had never seen before. Every inch was cultivated. We looked at it all the way during a two hour journey, and we began to appreciate that the Chinese system of agriculture had been in existence for a great deal longer than the rather vaunted agricultural system, both here and in America, under which we produce a great deal per man. The Chinese, however, have been cultivating these river basins for something like 6,000 years, and the land is improving; it is not being turned into a desert. The Chinese have enormous numbers of people working on the land and they are self-sufficient in food. They buy some wheat—and very useful that is to us—but against that they export rice. The food we had was delicious, although I doubt whether it is the kind of food that the 800 million Chinese eat every day.

We were taken to see the communes. Again, they shook our concept of what agriculture means. We went first to a commune outside Peking, the Red Star Commune. I shall not bore noble Lords with figures, but 83,000 people live in this commune—that is, 18,000 families. The total hectarage of the commune is 10,800, which is over 20,000 acres. The 83,000 people living in that commune work in the small factories, the repair sections, the hospitals and so on. In another commune in Shanghai 18,000 people live and it covers 1,000 hectares. That commune includes 19 small factories.

We were very impressed by the way in which the communes are operated more or less as self-developing capitalist units, producing their own factory goods and improving their methods of agriculture. We have a great deal to contribute in order to help the Chinese to improve not their methods of agriculture but their productive efficiency. I hope that the Chinese are sensible about it. From my conversations on this matter I think that they will be, although I should like to have had many more technical conversations. They appear to be going for the right things. We were standing on this great bridge and we looked down on the peasants working in the fields below. I must say I was jolly thankful that I was a Scottish peasant and not a Chinese one! They were irrigating, running with buckets of water slung on a carrier over the shoulders. They were harvesting by hand with sickles and they were carrying home the bales of wheat on their backs, and all this alongside a tremendous bridge which they had built themselves.

This is part of the whole concept of China—the two developments going on together. Eighty-five per cent. of the 900 million people of China live on the land. If they only improve their efficiency enough to get 100 million off the land into industry that will make them the largest production unit in the world— larger than the Japanese or the Americans —and I think they can improve and adapt their agriculture. I hope they will not go to the lengths that we do—in fact they cannot—but they can improve it in a different way, and before the end of the century they can make available something like 200 million people to work in industry. That is a terrifying but exciting prospect and one that we do well to consider.

I do not want to go on for too long because there are so many people who wish to speak. But I think it is important to say something about the cultural revolution, the Gang of Four and the 10 years before the present Government took power. Everywhere we went we were told about the mistakes of the Gang of Four. For example, we were taken round a very good library in a university. The librarian was very proud and he had a book out for each of us from our own part of the world. He actually had a copy of Burns to show me that they knew about Burns. It was all that a library should be, and then we went through to the reading room and there were 400 young Chinese of both sexes with their heads down and working jolly hard. We said it was very impressive and he said, "Yes, at the time of the Gang of Four there would have been five or six or maybe a dozen, and the rest would have been out waving little red books and annoying honest men who were trying to do a good job".

Then we went to a textile printing factory which, unfortunately, the noble Lord, Lord Rhodes, did not go to. That was extremely impressive and we asked how they got on during the time of the Gang of Four. The chairman of the revolutionary committee, who was the manager, said "Ah, well, when they tried to tell us that production freaks were bad we said, ' Well, if you do not produce you do not eat'. This appealed to our workers so we kept on producing." I think that private arrangements overcame many of his supply problems and certainly the Gang of Four were totally unable to influence the peasants of the country, who knew that food had to be grown, that seasons come and go, instead of peculiarities like this.

Another very impressive sign of the damage done to education and development during the last 10 years of the cultural revolution was given to us by the professors of medicine in a teaching hospital. When we asked them what were the political qualifications to get into the university, they replied, with grim determination, "Oh, yes, we accept that there must be political qualifications to come to this medical school, but now before they get in they have to pass our entrance examination". My impression when going round was that all the people that we met—and we were privileged, of course, to meet a great many of the responsible people of the new China—did not want the nonsense of the last 10 years to recur; they wanted to go ahead and to get the country on to a proper footing, to produce and to get to a stage so that in the year 2000 they will be coming up level with the West.

The opportunities for us in China are great and the Chinese are wonderful people. It is important to look at how they feel today. As I have said, we had excellent young diplomats as our guides and we met and talked completely freely with a very large number of people throughout China. The impression that I have is that they are back happily in their old feeling of being superior people, for which they have a very large number of reasons, to wit their civilisation goes back at least 4,500 years and they have every right to look on us as barbarians, in a way. But the lesson of their technical inferiority in the last 100 years, which has led to a great number of humiliations, has been well learned. I think that now the young Chinese managers, diplomats and teachers who we met are regarding the humiliations of the last 150 years as a small hiccup in Chinese history. They now know that they are back on track and from now on they must be numbered among the great nations of this world, whose views and whose might must be considered. I am sure that we can deal with them and that we can be friends. It is very easy to be friends with people who are sure of themselves and sure of their position; it is very difficult to be friends with chaps who have a chip on their shoulder and an inferiority complex. The Chinese have not got that, and I am sure that if our experience is anything to go by we can be friends with the Chinese, which would be of immense benefit to ourselves and to the world at large.

4.17 p.m.

The Earl of SELKIRK

My Lords, the House is deeply indebted to the noble Lord, Lord Rhodes, for the presentation which he has given us today. There is something delightfully colourful about thinking of the noble Lord, Lord Rhodes, the great realist, meeting the realists of China, and I believe that a great play could be written on that subject with advantage. He has made a most penetrating analysis of what he has seen and we are grateful to him for the picture he has given, just as we are to the noble Lord, Lord Mackie of Benshie, a distinguished agriculturist commenting on a totally different kind of agriculture. It has been most enlightening and valuable to us to hear it. I endorse entirely what he said: the great thing about the Chinese is that they have no chips on their shoulders at all.

I have not had the advantage of being in China, but I have been in most of the countries on the borders of China and I have lived in a Chinese population in Singapore for a period of four years. It may be worth noting just what the Chinese do in Singapore and in Hong Kong when the opportunities are open to them. However, I will look at this picture from a rather more objective angle than we have heard so far because I have not been there.

I believe that this is a moment of very real consequence in the history of China. It is today perhaps the greatest enigma of the international scene and I shall be fascinated to hear how far the noble Lord, Lord Goronwy-Roberts, will no doubt seek to explain just what is happening at the present time. Frankly, I find it confusing, but I am fairly certain that the Chinese have a great opportunity. We cannot judge much, but I think we can say that there will be a very real change in foreign policy.

In a sense, of course, the Chinese never had a foreign policy. They were the Middle Kingdom and the rest of the world was the outside world. They did not need a foreign policy, and when for the first time we tried to set up a mission there, going to immense trouble, we were eventually told that we could go back to our obscure and inaccessible island and stay there. Now they have changed this and they want relations, so far as one can see, with all countries in the world. It may be this is the first time this has happened in Chinese history. I think the previous opportunities they have had have to a great extent gone astray. They missed out entirely on the Industrial Revolution, and they did not miss out by accident: they missed out deliberately. Their intensive education, going back 2,500 years to the classics, made them eschew anything to do with industry. It is interesting that basically our education at that time went back to a different set of writings 2,500 years ago. But we were not so narrowly based and we were able to take in the developments which were taking place.

From that came one of their troubles. The public utilities were provided by foreign countries with all that that meant, the extra-territorial courts, the control of customs, which left a legacy of much unhappiness to the Chinese. We thought of them early this century as very charming but highly ineffective people. Now that has changed. In fairness, the next stage was when the Empire fell. Sun Yat Sen, incidentally, seems to be the only figure universally accepted as of stature at the present time, but even his revolution with all the intentions of democracy did not get very far; wars, both internal and external, conflicts of Communism and nationalism, left a pretty unhappy period of Chinese history. I have very little doubt that this did much to assist the seizure of power by the Communists in 1949. The one thing they did leave, and it is one of major importance, is a common dialect, which I believe now is being learned and spoken virtually the whole length of China from one end to the other.

The extraordinary feature of the Communist régime, which, of course, came in with all the beastly brutality which invariably accompanies Communist régimes, is the instability of this period; they could not stay fixed on any one policy. The Russian period came, and very largely through the sheer clumsiness of the Russians it did not last very long. The 100 flowers period, the 100 schools of philosophy, was pretty short. The great leap forward does not seem to me to have achieved very much. As for the cultural revolution, except for its violence I do not know that anyone is clear about exactly what came out of it. In any case, we will listen to hear whether the noble Lord has anything particular to say. But it was, as Lord Mackie has said, a pretty unsatisfactory period of 10 years. Now they are coming out of it. It seems to me we are looking at this country, with its traditions, having imposed on it theories devised in Highgate in this city and it is the impact of the one and the other which is going to determine what happens.

As has been said, it is the oldest continuous civilisation in the world, a highly educated body, and nowhere has education been sought more ardently than by Chinese students. I will not at this time elaborate on what is told but one hears of students of over 80 taking university degrees certainly in the earlier days. It is immensely proud of its high tradition. I do not believe that has been removed even by the last 10 years. But what I think is most significant to us is that it is united. Amidst the wars and other upheavals that have taken place there has been no separation movement; there has been no suggestion of Balkanisation, which, after all, we have had in Europe. In spite of the EEC, which may have the opposite effect, Europe has been greatly Balkanised this century. None of these sentiments exists in China at all.

I wonder whether we can be of mutual interest to China. This is, I think, the central point which we are discussing today. As has been said, they have a population three times that of the European Economic Community. Can we contribute to raising their standard of living? The dangers of a bad economy, the dangers which arise when people are widely and extensively dissatisfied, are great. I do not believe Hitler would ever have come to power if the German economy had been thriving in the early '30s. We can take that example in very many places all over the world at the present time. The question which I think we shall have to ask ourselves is, do we want to do this? Are we prepared to take the trouble? Are we going to do it in a thorough way? If we do, we must seek to understand China, understand that this country is different from other countries.

Its language is very difficult. I would like to ask how many people in the knowledge of the Foreign Office are learning Chinese. This is fundamental. It is all very well to have interpreters in Europe, but when you are dealing with a language which is wholly different in root and origin from anything in Europe I do not think you can ever hope to get the nuance of meanings and the basic sentiments of the people who are speaking. I believe that whether we take the trouble to learn the language properly is going to be a fundamental question. After all, they know far more about this country than we know about China. The number of people speaking fairly competent English in China is probably much greater than the number of people in this country who speak Chinese. In my experience there are not very many people with the capacity to master both languages. I do not reflect on the ambassadors, men like, for instance, Sir John Addis, who was a great expert on China and one of our great ambassadors, and indeed our first ambassador in China. But are there many of those?

The second point I would make is on the question of living in China. If anyone is going to exercise influence, we want men of calibre who are prepared to stay there and live there from time to time over a long period of years. This applies equally to commerce as it does to official relations. I know it is not easy to persuade people to do this, but if we are going to understand the country that is essential. If I may venture to say so, far the best books on China, I believe, are written by missionaries, people who have lived there for a very long time. And indeed firms like Jardine Matheson, who have been there through thick and thin, are much more closely in touch with the realities of the country.

I am not arguing about going back to the early philosophies of Confucius any more than we go back to Plato and Aristotle in our discussions, though you can apparently still use the name of Confucius in China if you want to defeat a political opponent. Mao Tse-tung visited the tomb of Confucius, so I do not believe one can regard these as things departed from altogether. I would like to suggest this, if I may, particularly to the Foreign Office. They should not regard this as just another country. It is a quarter of the population of the world. It should really be regarded as a special case. Our relations with China must in the circumstances, I believe, always be, shall I say, sui generis, of its own kind. I do not think in any other way can we hope to meet the very wide and varied circumstances which that country will demand. I am not talking about preferences of any particular thing, but about the basic question of understanding the vastness and variety of the country.

I say this because I believe we have the qualities here to be able to provide something of value. We have ourselves standards of value, different, but respected, I am sure, by the Chinese. We have the knowledge of science, of technology, which they earnestly require and which they desparately need. I believe that we have the toughness. The Chinese are the toughest people in the world and they respect toughness in other people. I should like to add that in one of the more recent statements they speak of what they call "the four modernisations": industry, agriculture, science and technology, and defence.

Although the Chinese have taken certain actions through Communist channels before, I can see no sign of the Chinese wanting to extend beyond their Border at present—or should I say the Border as defined in the T'ang Empire. I must say that I believe that the anxieties which the Russians have in this respect, unless they are thinking of something like a preventive war, are wholly unjustified. In conclusion, there is a great opportunity here, and if we handle it well I believe that we can be of great benefit to future generations.

4.30 p.m.

Lord CHALFONT

My Lords, like other noble Lords, I am extremely grateful to the noble Lord, Lord Rhodes, for giving us the opportunity to debate briefly this evening the extremely important question of relations with the People's Republic of China. I should like if I may, and perhaps not surprisingly, to dwell on one specific aspect of those relations—namely, that complex of relations which involves international security and international strategy.

The noble Lord, Lord Mackie of Benshie, said in the course of his speech that the Chinese tend to see certain events in recent history as a hiccup in the broad sweep of history. It is important that we should realise that the Chinese have a different view of the rhythm of international affairs. They take a much longer view than we tend to take in the West.

I think that that was most vividly illustrated by a story which Dr. Henry Kissinger tells of an experience which he had in Paris at the time of the negotiations about the Vietnam war. One evening after a long and hard day's negotiating, he and the other diplomats and politicians were sitting around in the home of their French host. They were discussing the events of the day when the French ambassador, the host, wishing to lift the level of conversation somewhat, asked whether they could have a short conversation about what had been the effect of the French Revolution on the political development of the world. He turned first to Henry Kissinger and said: "Secretary of State, could you say a word about the effects of the French Revolution on the political development of the United States?" Henry Kissinger, being an expert in this kind of thing, delivered a beautifully rounded lecture mentioning such names as de Tocqucville and Lafayette and reviewing all the political developments in the United States. It was an enormous success; indeed, so much so that the French ambassador, much emboldened, turned to the Chinese representative, a very wise and ancient gentleman, sitting next to Henry Kissinger. He said: "Tell me your Excellency, what has been the effect of the French Revolution on the development of your country?" After a brief pause the Chinese gentleman said: "It is too early yet to say."

I think that that example makes a real point, which is that the Chinese feel themselves to be part of a great historical development. They believe, as I believe also, that we are at present seeing a great and fundamental change in the balance of power in the world. I use the phrase "balance of power" not in the 19th century realpolitik sense, but in a much more practical sense. We are seeing real political and military power shifting fundamentally and we are seeing it, in my view, shifting away from the West. When I say that, I am not making some academic, analytical statement but saying that the safety of this country, the security of the Western world and the survival of our freedom are becoming increasingly at risk. That is what I mean by a shift in the balance of power.

We have only to look around the world at present to see all the evidence of that— it is clear and unmistakable for everyone to read. We can see it if we look at the changing military balance, in strategic nuclear weapons, in the land forces in Europe, and in the maritime strength of the West and the Soviet Union. We can see it if we look at comparatively small changes—or so they may appear to be on the surface—like the shift of the ideological climate in Afghanistan. We can see it if we look for a moment at what is happening and what might happen— unless we are all very much more imaginative and careful than we have been up to now—in Iran, which incidentally has been the subject of the most extraordinary campaign of misinformation and disinformation and sheer misleading rhetoric in the Press and media of this country that has been seen in recent years. We can see if it we look at what is happening in Southern Africa and what might happen there if, again, we are not more courageous and more imaginative. If we cast our eyes to the Middle East, to the Horn of Africa and to almost everywhere in the world there is, for those who want to see it, evidence that the long-term security of the political systems to which we are committed and in which we believe is increasingly under threat. It is in that context that I believe we should contemplate our relations with the People's Republic of China.

In a few week's time I shall pay my fourth visit to the People's Republic in the course of the last three years. There has been a change of a fundamental and dramatic character in the attitudes of the Chinese to the outside world and I believe most sincerely that that should be matched by a fundamental change in our attitudes towards the Chinese. When I visited that country for the first time, the Chief of the Defence Staff of this country, Sir Neil Cameron, had just made a speech in which he referred to the "common enemy at the door of China and the West" and he said that the home of that common enemy was in Moscow. That seemed to me to be no more than a soldierly and accurate analysis of the current state of affairs and it caused a certain amount of uproar in this country; but shortly afterwards I had the opportunity of having a long and detailed conversation lasting several hours with General Wu, the Vice-Chief of the Chinese General Staff. I was enormously impressed by the breadth and depth of his knowledge, by the sophisticated nature of his discussion of the balance of power and the strategic factors that go to influence it. He said "We may not necessarily have a common enemy, but we have common fears. You fear that your freedom and your political system may be threatened by the social imperialists of the Soviet Union: we fear the same thing. So, whether we have common enemies or not, we have common fears." He went on to say in a phrase of typical Chinese irrefutability "Therefore, as fear begins in the heart, we are allies in our hearts."

That was at the end of a long, complicated and sophisticated analysis of the strategic situation as he saw it. It seemed to me that it contained more than a grain of truth. Whatever is happening to the balance of power in the world, there is a very clearly defined and clearly identifiable common interest between us and the Chinese, but that is not to say that we regard their Communism as being any more admirable than the Communism of the Soviet Union. That is not the point in this case. The point is: whence does the threat come? As the noble Earl, Lord Selkirk, was saying a moment ago, there is no evidence of any kind that the Soviet Union poses a threat to anyone else in the world now or, in my view, in the foreseeable future.

The Earl of SELKIRK

My Lords, does the noble Lord mean the Soviet Union or China?

Lord CHALFONT

My Lords, I made a slip which can hardly even be called Freudian. I am grateful to the noble Earl. There is no evidence of any kind that the Peoples Republic of China—and I emphasise that—poses a threat, now or in the foreseeable future, to the rest of the world. I think that those who are familiar with the articles that I sometimes used to write in The Times—if anyone can remember that newspaper—will realise that that was only a slip of the tongue.

I have had an opportunity, perhaps more favourable than that of many people, to study the military forces of the Peoples' Republic of China. I am convinced that their equipment, their training, their tactical doctrine, their strategic doctrine, their deployment and everything about them indicates that they are entirely devoted to the business of defending the territory of the Peoples' Republic of China. In my view, not only do they not have any intention of operating outside the boundary of China, but I do not believe they would be able to do so effectively for any length of time.

Therefore, it seems to me that, when we consider the possibility of closer relations in the military sphere with the Peoples' Republic of China, we should not be too influenced by those who say that if we arm the People's Republic of China now, we may be producing a stick with which we ourselves will be beaten before too long. In my view, it is a possibility so remote as to be almost non-existent that, even if the People's Republic of China modernises its defence forces at the speeds it intends, it could pose a threat to anybody within the kind of time scale that makes any sense of reality in international politics.

So I would simply ask Her Majesty's Government to look at the possibility of our relations with the Soviet Union——

Baroness DENINGTON

My Lords, the People's Republic of China——

Lord CHALFONT

My Lords, yes, with the Soviet Union and China. We should look at our relations in a much broader context than simply that of commercial advantage or the economic balance of power in the world: we should look at them in the context of the balance of power and the broad context of international security. I hope that the noble Lord, Lord Goronwy-Roberts, will assure the House that Her Majesty's Government have no intention whatever of being bullied by the public statements of Mr. Brezhnev. Quite clearly, Mr. Brezhnev is worried lest, for example, this country should sell the Harrier aircraft to the Chinese. Yet I think it is true to say that, if it is ever possible to distinguish between weapons designed for defence and weapons designed for aggression and offensive action, the Harrier—the Jump Jet as it is sometimes called—certainly falls in the category of a weapon designed for defence rather than for any kind of organised aggression outside one's own frontiers. I ask the noble Lord to assure us that the bullying pronouncements of the leaders of the Soviet Union will not in any way be a decisive factor when Her Majesty's Government come to make the important policy decision about whether to sell to the People's Republic of China, either the Harrier or any of the other pieces of military equipment which they say they need and which I believe they need for the defence of their own country.

I also hope that Her Majesty's Government will not be too heavily influenced by the friends of the Soviet Union in this country, who, I am sure, will be lending their weight to the opposition to this kind of co-operation with the Soviet Union. In addition, I hope that whatever may be the views of Her Majesty's Government regarding the strategic arms limitation talks between the Soviet Union and the United States, they will not be too much influenced by those negotiations either. If it is suggested—as I have reason to believe it has been—to Her Majesty's Government that to engage in military co-operation with the Soviet Union might endanger the outcome of the SALT talks——

Lord BOWDEN

My Lords, the noble Lord means China.

Lord CHALFONT

My Lords, I am sorry. I have done it again.

The Earl of SELKIRK

My Lords, that is three times.

Lord CHALFONT

My Lords, I would hesitate to suggest that for "China" one should read "the Soviet Union". I hope that if this should happen Her Majesty's Government will consider what will be the advantages to this country of the Strategic Arms Limitation Agreement between the Soviet Union and the United States and what would be the comparable advantages of co-operation with the People's Republic of China.

Clearly, what is needed here, of course, is a combination of realism and prudence. No one suggests that the attitudes and policies of the People's Republic are immutable. They have changed before and they might change again. I should be the very last to suggest that we should engage in the extremely dangerous policy of playing one great Communist power off against another. Clearly, that would be the most profound folly on the part of the West; indeed, it is a policy that would be rejected out of hand by the Chinese Government themselves. They do not want that kind of relationship with the West. However, they want a recognition that there is a common fear and a common threat.

In the course of my conversations with General Wu, he made one extremely interesting comment which I thought was typical of the kind of imagery that the Chinese leaders like to use, when he said "We and you are faced with a dangerous and rampaging bear". He then said "I think that we should get together; that you in the West should look after the head and we in China, should look after the tail". I pointed out to General Wu that I thought this was a somewhat unfair distribution of labour, but at least he had made his point.

I think there is a common interest and a common threat and I shall simply conclude by expressing the hope that Her Majesty's Government will regard relations with the People's Republic of China not in the narrow context of commercial relations or economic advantage, not in the narrow context of pursuing some policy of detente with the Soviet Union, and certainly not in any narrow appreciation of the Chinese as a potential threat to the rest of the world, because I do not believe they are. I believe that the threat comes from elsewhere. I hope that in the context of that threat, Her Majesty's Government will conduct relations with the People's Republic of China with a careful appreciation of the threat which now exists to the political systems of the West and, therefore, in the long term, to the safety of this country itself.

4.48 p.m.

Lord SOPER

My Lords, the House will be under an obligation on two counts to the noble Lord, Lord Rhodes, for initiating this debate. First, because it has given many of us the opportunity better to acquaint ourselves with what, in fact, is happening in the changed circumstances of China. I have no specific information at first hand to add to what has already been said, although I have tarried somewhat on the Borders of China, looked over the Wall and have taken the precaution of having a brother-in-law as a director of Matheson's. However, I am satisfied that there are facts behind the proposition that we should look at the importance of what is happening in China, and those facts are indisputable.

It is their importance which enables me to delay your Lordships somewhat by taking a little wider view of some of the implications which appear to me to be valid as we think of what these changes portend and what, in fact, they reflect. I heartily agree with those who have spoken in admiration of the Chinese people. It has sometimes occurred to me, ecclesiastically or theologically, that the Chinese people seem to be infected with a rather milder form of original sin than the rest of us. Indeed, noble Lords may remember that on one occasion in your Lordships' House the late Lord Montgomery, who had been visiting China, brought back with him evidence to that effect, which he shared with your Lordships.

The evidence that has been put before us this afternoon represents, I think, the fulfilment of what many of us have hoped for, and what I think is evidentially now apparent. In these 900 million people there are virtues and qualities which can fertilise the whole world; and we are necessarily the better that they have shared, or are beginning to share, most of these qualities in a larger context than that which surrounds their own enormous Cathay. Therefore, the importance of these changes, if they release into a wider sphere the qualities and the achievements of the Chinese people, whether under Communism or any other régime, is itself a virtue to be regarded and a blessing for which to be grateful.

The second importance seems to me to lie in the field of the ideological content of this change. I was brought up in the day of the great battle for the mind as between those who embraced a Christian view of life and those who accepted in broad outline the Marxist interpretation. I remember how difficult it was to contradict the monolithic idea of the Communist argument as represented by Marx—or perhaps more accurately by what Engels thought Marx had said. I was impressed by the argument, the analysis of what had happened, and I was attracted by the prophetic nature of what inevitably, also scientifically, was sure to occur.

This latest development in China is perhaps the final and necessary nail in the coffin of that monolithic concern with dialectical materialism as a scientific evaluation of the past, and as a completely inherent prospect and prognosis of the future. With Berlinguer advocating something in Italy of what he is pleased to call a democratic Marxism; with Marchais in France talking in terms of accommodation with the bourgeois, and indeed the Vice-Premier of China, if that is his correct title, Mr. Teng Hsiao-ping, in a conversation with an American journalist only the other day, proclaiming quite categorically that the bourgeois had a necessary part to play in the future conduct of affairs in China and were to be lauded in so much as they played it correctly; the kind of Communism as represented by Allende—the late lamented Allende—to say nothing of the changes which have taken place within that small group, the Communist Party in this country; I take no particular comfort in saying how fissiparous is that process, but it represents in the latest events in China the total repudiation of the idea that prophetically the Communist argument is unanswerable. This is no longer so, and the Chinese people have been wise to see it to be no longer so, and are acting accordingly.

But to me far and away the most impressive and important element in this debate today is that to which the noble Lord, Lord Chalfont, has just referred. Let me introduce what I feel I must say on this particular count by reflecting that I could not find anybody in Australia, or Singapore, or Hong Kong, who entertained any hope that finally war as between China and the Soviet Union was avoidable. It was an appalling experience to find that even those who are most optimistic in other fields were calculating on an eventual conflict. For instance, the other day comment was made upon the treaty organised as between Japan and China.

Perhaps it will be of interest to your Lordships, if you are not already aware of the significance of that treaty of friendship, that in 1976 it was Mr. Gromyko who went from Moscow to Tokyo and there proposed a Treaty of Friendship and Co-operation which the Japanese were not prepared to sign unless they had returned to them the Kurile Islands, which the Russians had grabbed in the last days of the last war. That completely broke down. Thereafter, the Chinese and Japanese came together and consequently, as Joseph Harsch says in the New York Times, and I think it is un- answerable, instead of Japanese technological capability being applied to the industrialisation of Siberia, that immense capability will now be applied to the industrialisation of China. And, said the Vice-Premier, "This is one of our ways of opposing on equal terms the hegemony", as he called it, "of the Russian menace".

I entertain very little confidence that that final catastrophe—and it may well be a final catastrophe—can be avoided. I take no comfort whatsoever from the conjectures offered so clearly by the noble Lord, Lord Chalfont. I have meditated on this somewhat, and I intend to say that I believe that the present situation in China calls for a reappraisal on the part of all people of the pacifist argument. I do not necessarily agree with Arthur Koestler, who may be regarded on the one hand as a polymath and on the other as a man educated rather above his intelligence. I prefer the first of those opinions. I think you disagree with Arthur Koestler, particularly in his latest book, Janus, at your peril, but I am not competent to enter into the almost metaphysical arguments which he presents. However, I find substantially formidable, and almost convincing, his argument that the human species contains within itself a fatal flaw which can be as finally damaging and lethal as was the flaw that caused the end of the brontosaurus and the sabre-toothed tiger.

He believes it is our incurable practice of violence; and that we as a human species have a characteristic in our violence which is not shared even by the most predatory of what we are pleased to call the lower creation. An army of locusts will eat almost anything except another army of locusts. Human armies consume one another. Furthermore, I remember in your Lordships' House that it was none other than the noble Lord, Lord Snow, who presented the argument that with the increase of armaments and the present "overkill" of eight times, and the fact that within the next two years 12 more countries will have acquired the nuclear capability, the prospect, nay the certainty, of an accident with incalculable consequences is almost as certain as any calculation can possibly be.

I therefore believe that we are set upon a course which, unless it is varied and radically changed, may well prove both Arthur Koestler, and the noble Lord, Lord Snow, as correct. I have no enjoyment in saying these things. I believe that the proliferation of arms and the execrable business of selling them is part of a fundamental process in our human make-up, of which the arguments so admirably presented by the noble Lord, Lord Chalfont, are a confirmation, and lead me to the conviction that in any discussion of these matters on such an occasion as this it would be totally improper to leave out that which is unquestionably a minority movement, and perhaps a very small one. I believe that the world is waiting for some community voluntarily to reduce to the point of non-existence its capacity to kill. If you say to me that this is crackbrained and Cloud Cuckoo-Land, I find no comfort in what is called the realism of the present situation.

I find that situation increasingly dangerous, and I just make my own statement of belief that we, who have been prepared in the past, to take such inordinate risks in the field of violence, depend for our future on our readiness to take appropriate and comparable risks, which might indeed produce immediate results of a very unfortunate and unpleasant nature. It could redeem this world from a process of inevitable catastrophy of which, it seems to me, the Chinese people at the moment are increasingly aware and are at their wits end to know how they can postpone this, though they cannot prevent it.

They believe—here I heartily agree with the noble Lord, Lord Chalfont—that there is a balance of power which can be achieved as between an emergent China and a more or less, from the point of view of arms, fulfilled United States. I believe this polarisation is lethal and mortal and, whatever may be the reaction of your Lordships, I cannot forbear to say that in my view the hope of the future is for human beings in China, America and the Soviet Union to say to themselves, "We have embarked on processes which are finally disastrous. We must at all costs abandon those processes". I have the cherished and perhaps foolish opinion, but nevertheless the real and sincere one, that in our reactions now to a changing China nothing could be more helpful and fruitful than to set an example which these magnificent and wonderful people could follow and, in following, might well persuade even the most violent to follow in their stead.

That is my belief, and I think it should be included in any conversation on the emergent situation in China, of which China is the representative of a revolutionary situation in the whole world; and the pacifist attitude, difficult to understand, even more difficult to practice, seems to me to coincide particularly with the Advent season on which we have now entered.

5.2 p.m.

Baroness VICKERS

My Lords, I am sure all will sympathise with me in having to speak following two such great orators as the noble Lords, Lord Chalfont and Lord Soper. I am tempted to join in this debate first because I wish to congratulate the noble Lord, Lord Rhodes, on his excellent report and, secondly, because I have had the opportunity of visiting China on two occasions, once in 1961 and again in 1973. I had the opportunity in 1961 to go entirely alone, which was advantageous because one sees far more in that way. In 1973 I led a Parliamentary delegation and we were very grateful to the ARIEL Foundation for their financial support.

I wish therefore to take this opportunity to thank my Chinese hosts for their hospitality and to say what a tremendous change I found between 1961 and 1973. There was greater prosperity, an increase in consumer goods, a healthier population; even the schoolchildren seemed to be taller, because they had been better fed, and the economy had improved. I also found an enormous difference in the approach of the Chinese people. For example, in 1961 one always had to interpret through a Party official. On the later occasion they were much freer and we are delighted to see from reading our Press that British correspondents can now tell us directly what is happening in China; in other words, the Press is much more open.

The fact that Lui Shao-chi and Teng Hsiao-ping are freely mentioned by name is very interesting, especially now that the latter is the Vice-Premier, Deputy Party Leader and Deputy Chairman. I suggest that in coping with this moderation programme, it appears that China is concerned with the problem of devolution without impairing the strength of the communal cohesion and participation which has been painstakingly built up since the foundation of the New China in 1949, and it is important that these two should go side by side.

I understand that Mr. Eric Varley expects to visit China in the New Year to discuss projects which will carry forward economic co-operation between Britain and China, and the draft agreement reached during the visit of the Vice-Premier, Wang Chen, during November whereby both countries aim to achieve at the end of 1985 a level of trade in both directions which will, I gather, total between 8 and 10 billion dollars should be helpful to both countries; and when one discusses the question of defence—and, as Lord Soper did, the future—one must think what the present will be for the people, and we want to try to help to raise their standard.

I notice that both France and China have succeeded in getting large contracts to help the people of China. A particular point I wish to raise with the Minister is the lack of good reception we give to Chinese officials when they come here. When, for example, their Ministers go to Belgium they are met by the King and Prime Minister; in other words, they get the red carpet treatment. In France they are met by the President. Regrettably, we do not give them the red carpet treatment when they come here, and I would suggest that a Minister, the Marshal of the Diplomatic Corps or somebody similar, should undertake to receive them because the Chinese are a very proud people and they have been received so much better elsewhere in Europe than has been the case in this country.

I should also be grateful if the Minister would comment on the controversial issue of arms sales to China. Was this matter raised at the European summit? I gather that President Brezhnev warned France and Italy about what he called the dangers of selling arms to China, and, following what Lord Soper said, I should like to know whether this matter has been raised and what has been the outcome.

It might be advantageous to mention what is happening in this country—what action we are taking here—because there have been a great many outgoing organisations. I believe the noble Earl, Lord Selkirk, mentioned the learning of Chinese. He will be pleased to know that recently 22 British postgraduates, 20 on scholarships, and six undergraduates have gone to China for over a year in connection with the language question. In addition, five English language teachers and eight delegations have come here to discuss this question. I understand we are to have the pleasure of receiving 14 incoming delegations, including the Foreign Minister, Mr. Huang Hua, and Mr. Wang Chen, the Vice-Premier. Also, at the invitation of the Minister of Education, it is anticipated that Mr. Lui Hsi-yao will be coming this year. One matter which the delegations have particularly asked us to deal with is the question of librarians, because they say—as we have heard the Russians are doing—they are still reading Dickens and they want to know something about more modern books. Accordingly, they have invited a number of writers to go to their country to give lectures, and I believe that will make for a better understanding between our two countries.

Another organisation, the Chinese People's Association for Friendship Countries, has recently visited here and Europe. The Arts Delegation, which produced six members whom I had the pleasure of meeting, was sponsored by the Chinese Ministry of Culture and they were received in Britain by the Great Britain-China Centre. I had the pleasure of seeing an excellent film of young people playing modern music, European music with one exception, and a charming boy aged eight playing the violin. While we may not be able to speak the language, we can get a lot of understanding by means of these musical entertainments because we both understand the same musical language. I gather that about 1,000 students will be coming for science, language and the humanities. I am sure that will be very popular here with us; we will entertain them and interest them, particularly in the humanities, as I am sure Lord Soper would agree. Furthermore, delegations are now going out to see about hotels—Wimpey in particular— and agricultural machinery.

It is interesting to note that the Chinese are being asked in their own country to achieve a degree of industrialisation in 22 years which took the nations of Europe more than 100 years to achieve. This will require unique working arrangements and the setting up of institutions. There will be far-reaching effects on the Chinese economy resulting from large-scale introduction of foreign technology and industrial plant. I understand that there are some 10,000 Chinese scientists and engineers already training in Western countries. It has been estimated that China will have to invest about 30 billion dollars for each 10 billion dollars spent on industrial plant. The burden will be enormous, and we wish her success.

As Britain is still a member of the EEC, I should like to refer to joint action with EEC countries. There is now an ambassador from China, Mr. Li Lien-pi, in the Community, and Sir Christopher Soames (as he then was) visited China in 1975. As a result of that, in 1978 there was a trade agreement between the EEC and the People's Republic of China. Getting together is of very great advantage, and I understand that this may mean that there will be a joint trade commission which will provide the right type of mechanism for future trade.

China is estimated to possess 30 per cent. of the world's main mineral resources, and Mr. Wang Jun-sheng, who visited Europe in 1977, stated that the Chinese Government would welcome proposals from European firms in particular for the exploitation and marketing of these raw materials. I consider that the EEC might, like Japan, have a barter agreement, exchanging plant and capital goods for raw materials. The possibility of an EEC consortium of equal partners doing business with China would be preferable.

I turn now to the question of technical needs. China is intending to triple her steel output to 60 million tons, to develop 10 iron and steel complexes, eight coal mines, 10 oil and gas fields, 30 power stations, six trunk railways and five harbours by 1985. This will mean tremendous activity on her behalf and, I hope, considerable help from Europe as a whole.

New market situations require new marketing concepts, and the EEC-China agreement should help both China and the EEC. The Europe China Association has been formed, and I have just been told that I am to be the future president of this organisation. My contact began with a dinner party in the House of Lords and the annual general meeting held in London. I am sure that your Lordships will be delighted to know that now there is an international summer school which meets in Lady Margaret Hall, Oxford. Last year the theme was Ideology in China, Past and Present. I am sure that the noble Lord, Lord Soper, will be pleased to hear that one of the lecturers was on Christians in China, and other topics included Chinese communism and traditions, and China past and present. This year's meeting of the school will discuss China, medicine and the West. So I believe that we are trying in this country to gain better contacts. I should add that at the seminar there will be German-speaking Chinese, French-speaking Chinese, and English-speaking Chinese who will give classes in learning Chinese, a point which was raised by the noble Earl, Lord Selkirk, and which I agree is very important.

I should like to end my speech by quoting what the noble Earl, Lord Bess-borough, said in a debate in this House on 30th November, 1977; as reported at column 1296 of the Official Report: The leaders of China are looking for a response from Europe … It is fundamental that in defining the European response the efforts of Community firms should not be stymied by political hesitation … that a political impulse should be given to Europe's relationship with China that engenders confidence, encourages initiatives, results in increased understanding and reaches for mutual esteem". I am sure that everyone will agree with those last two words, that we all want to have mutual esteem, and I am quite sure that that is something we have in this House.

5.15 p.m.

Lord BOWDEN

My Lords, the only possible reason that would justify my intervening in the debate is that I was a member of the small group of people led by Lord Rhodes on our excursion in the month of June. I must begin by paying a tribute to him, our leader. He was immensely impressive. He organised the whole affair himself, and on more than one occasion when we met some of the senior Ministers—men whom I would regard as being as tough, as hard-hitting, and as fearless as any statesmen in the world —he was able to hold his own, and in some cases give them rather more than they had expected. We were enormously proud of Lord Rhodes as an ancient warrior who knew from personal experience what it is like to be a trader, a warrior, and a statesman. We were most indebted to him.

It was for all of us a quite extraordinary experience, and as the noble Lord, Lord Mackie of Benshie, has said, it is only when one actually goes there and sees the place that one realises how enormous it is. The most striking single figure I can recall is that in the age group 20 to 50, which is reckoned to be the productive age group, the number in China exceeds the number in Russia, in Europe, in the United States, and in Japan put together. Furthermore, not only is there an enormous number of them, but those whom we met were acutely intelligent, diligent, and, what is more, in a very fundamental sense, disciplined and enterprising in a way which seems to have been forgotten in England since the end of the last century. They had supreme self-confidence. They knew what they wanted, and they had every confidence that they would achieve it. They seemed to be the most extraordinary workforce that this world has ever seen, and there is no doubt at all that whatever happens they will find a way to employ their talents and achieve great things. This is a most important first observation to have made.

There is no doubt at all that the whole economy of China is beginning to burgeon, but at the same time it is equally obvious that it is still in a rather primitive condition. For example, they desperately need to extend their irrigation works. Only about a year ago they finished a system of irrigation on a river which was first tamed by a man who has now become almost a saint and who started work about 2,000 year ago. However, they still need to invest greatly in irrigation, in the building of factories, in the improvement of agriculture, in the construction of coal mines, and in the development of airlines, railways and roads. In other words, they have an enormous problem to increase the effectiveness of their infrastructure before their manufacture can really begin. This seemed to me to be the most important single lesson we learnt. There is an enormous number of men and women anxious to start work on the modernisation of their great country. Since 80 per cent. of the population work on communes, they are acutely aware of the dangers that would come from too speedy a mechanisation of agriculture which led to the possibility of 100 million unemployable Chinese in shanty towns all over China. No such thing has happened yet, and they have adopted a. rigorous policy for controlling the mobility of labour so that a man can hardly leave his commune until he has an assured position to which to go in a town.

Thus they are aware of the dangers of too rapid mechanisation. They have seen the effects that this has produced in other parts of the world, and they have learnt as best they can from the mistakes of the whole of the rest of the world, including in particular the mistakes of Russia. They know that Russia based its revolution on the assumption that the industrial proletariat must be the pacemakers, and they saw what happened to the agriculture of Russia as a result. They themselves have based their revolution on the supremacy of the farmers because they know perfectly well that the whole of the efforts of the rest of the world would not suffice to feed China were they unable to feed themselves.

Their agriculture is improving its efficiency, but it could be much better. More irrigation, more fertilisers and a certain amount of mechanisation would doubtless do wonders for it; but for many years to come the majority of Chinese will inevitably have to work on the land, as their ancestors have done for the last 3,000 years. They are aware of the fact that although, as they realise, theirs is the oldest of all civilisations, they have been surpassed by some countries of the West in productivity, and they are most anxious to make up the arrears.

When I was a young student I met an elderly Chinese physicist who told me that in the history of the world China had been the pre-eminent Power in armaments, in science, in the arts and in the fine arts except for brief periods of 100 or 200 years, during which other countries had temporarily taken the lead. He said, "We are in such a period today, but it will not last. If you do not see it, your children will—the day when China is again the greatest Power in the world". Having seen the country and seen the rate at which it is developing itself, I am inclined to think that he was right. The Central Kingdom was to the Chinese the centre of the earth, and all other countries came to pay tribute to it.

Their ways are not our ways—we must accept this. For example, in Peking I was in a room almost the size of this Chamber, and I was told that it was a very historic room in which the final examination for the mandarinate took place. For more than a thousand years the Chinese chose their governors by a series of competitive written examinations. The particular point of this room was that the top dozen men in the final examination were brought in here to be examined again; they were put in order; and from the best candidates the Emperor chose the men who were to marry his daughters. In those days, Chinese Emperors were very much married men and every year they tended to produce a crop of marriageable daughters, and they were married off to their senior civil servants.

I asked our guide what happened if a particular couple had got together and the man who came out top wanted to marry the second daughter in order of age. He said that so far as he was aware this problem had never arisen in the whole of the history of China, because as far as he was concerned a civil servant who was offered the opportunity to marry the daughter of the Emperor married the daughter of the Emperor and did not argue about which daughter of the Emperor he married. This is perhaps evidence of a rather different attitude to life from the one which we have in the West, but they thought it perfectly normal and undoubtedly it worked for them. So I say that their ways are not our ways. They have selected their civil servants for a thousand years by requiring them to write what I can best describe in modern equivalents as essays, let us say on the quantum theory, in sonnet form—an extraordinarily taxing problem which they thought chose men able to go out and govern a Province. But I stress the point that, although some of their ways seem to us to be odd, they are the most numerous and the most industrious workforce in the whole world.

That brings me to the problem which was raised by the noble Lord, Lord Chalfont, and the noble Lord, Lord Soper—the fear that the Chinese have of Russia. It seemed to me to be terrifying that they were prepared to contemplate an almost inevitable conflict, and they thought of it in terms of a battle in which the Chinese would defend themselves against Russia to the last Englishman and the last Frenchman. They felt, in fact, that they must ally themselves to Europe in order to contain Russia. I wondered very much whether in fact they had developed this almost hysterical fear of Russia because of a belief as a nation that at this particular stage in their development they had to have an external enemy, or an internal enemy like the Gang of Four, against whom to unite the people. They contemplated the possibility, they said, in case of war, that not only the populations of Western Europe but perhaps 400 or 500 million Chinese might be killed; and they thought that if that happened the survivors would be able to recreate the civilisation of China, which they felt to be the best in the world.

I feel that the argument that we should be prepared to let them have Harriers may perhaps have justification, but far more important is it, in my view, to help them to develop their industries, to help them to become rich, to help them relieve themselves of the fear that they are going to fight someone else merely to survive. They have, I think, an immense potential to become rich. They are a very cheerful people, and they are very willing to be friendly with us. I found in talking to them that in many ways they are, of all the oriental people I have ever met, the most like us in understanding, in background and in the way they think. I hope so much that we shall be able to exploit this fact to our mutual advantage, and that we shall not allow ourselves to be totally overwhelmed by this terrible fear they have of Russia and this desire they may have to destroy Russia even at the cost of the destruction of Western Europe as well as themselves.

Now, I should like to pass to one or two other points which became very obvious to us. The first is that, anxious though they may be to buy from us the best that our technology can give them in the form of, let us say, new equipment for coalmines, new equipment for diesel engine factories and, most particularly, new equipment for their armament factories, much more than that do they want the ability to build these things for themselves. They would not in any circumstances contemplate a situation in which, in the long-term, they were wholly dependent on the Western World for what they regard as essential commodities or essential tools with which to create commodities. They need—desperately they need—to learn how to do it. That is why they are so terribly anxious to develop the contact—about which the noble Baroness, Lady Vickers, spoke a moment ago—with our universities. They want to educate their people in the technologies in which we, really rather to their surprise, have the advantage over them at the moment.

They want us to help to educate their students, and they are prepared to send their students over here. But, to me, one of the most encouraging things of all concerns their universities. Their university system (I can perhaps be rather crude) is, I should say, about as big as ours, their population being perhaps 20 times as big as ours. Their universities, such as we saw—we saw very few—are perhaps as well equipped as ours were 20 years ago, but not so well equipped by any means as ours are today; so they know that they have a long way to go in developing their universities.

They therefore feel that there is much to be gained by collaboration with our own Open University. Three of their delegations have been over to see it already, a couple of ours have been out there, and I think about half a million Chinese have already been exposed to some of the text books which the Open University has at its disposal. Here, I think, is a wonderful opportunity for collaboration to educate men who can create the great industries which China will undoubtedly have before long.

We saw—and we were extremely fortunate in this—several of their schools for young children. I was absolutely amazed at the vigour, the skill and the charm of the little children who sang songs for us, who danced for us and so on. It was extraordinary to find a small girl of about five years of age who came in and, with an enormously loud, clear voice which would carry right through the Albert Hall, announced that the children were going to sing. I wondered then, when I saw them, how they would ever be able to go and work in a paddy field or in a textile mill with this wonderful ability in the arts. I discussed this and they said, "We like to let them do this sort of thing now and we hope that, however long they live, they will continue to do it, as a hobby." They are capable of changing themselves and of rising above the enormously laborious work which they have had to engage in for so many thousands of years. They are capable of mass efforts which are sometimes extraordinary.

Perhaps I may give your Lordships one example. As you know, much of Chinese farming depends totally on irrigation; the dreadful disease of bilharzia spread all over China. It depends on a snail which haunts these irrigation ditches and which carries the parasite which produces the disease. About five years ago, one small county in China discovered that it was possible for them to exterminate the snails in their own ditches—and, therefore, to kill bilharzia. They triumphantly announced this to Chairman Mao. He said that he was so moved and excited by this information that he could not sleep. He rose at three in the morning and wrote a poem. You may think this a rather unimportant consequence; but six months later nearly 700 million Chinese were in the ditches, up to their knees in mud, exterminating snails—and bilharzia, apparently, has now been virtually eliminated, as have many other of the diseases which used to afflict the population; and to such an extent that one of our hosts at the hospital told me that they had the greatest difficulty in showing to their medical students cases of such diseases as tuberculosis, malaria, bilharzia and smallpox which had been destroying the population only 20 or 30 years ago.

They have made enormous strides forward. They are, potentially, the greatest nation in the world and we, as a small island off the shores of what is a small peninsula of the great landmass of which China forms part, must take note of them, help them all we can and hope to join with them in the prosperity which can be theirs. And we must—and this is more important—do all that we can to try to prevent the holocaust which otherwise is held to be inevitable.

5.33 p.m.

Lord ENERGLYN

My Lords, on the 19th day of May, 1906, the San Andreas fault quivered and 700 Americans lost their lives in San Francisco. That became the most dramatised and publicised earthquake of the world. In 1920, an earthquake shattered the province of Kan Su and annihilated 200,000 Chinese. Seven years later, the same province was shattered by another earthquake which eliminated another 100,000 Chinese. And yet that province is as densely populated today as it was then. That anecdote, I suggest, illustrates the indifference of the English-speaking world to China; because scarcely a mention will you find in the Press of those Kan Su earthquakes. There was one in the 16th century which is alleged to have destroyed 800,000 Chinese. That is the kind of environment in which China has built up its culture and its philosophies over thousands of years. As the noble Lord, Lord Bowden, has said and emphasised with great clarity, they are people we must learn to live with but, above all, as the noble Lord, Lord Mackie, said, we must learn to respect and to acknowledge them never as inferiors but at the very least as equals. Certainly, culturally, they have a greater claim to fame than ourselves.

To me, China has always been one of the wonders of history, a part of the world that has always been on the defensive. It has never been really aggressive; it has been invaded but never destroyed and never really conquered. The whole history of China, as the noble Lord, Lord Chalfont, has been at pains to point out, has been one of defence, defence against intrusion. And it is really vitally important, as all speakers have pointed out, to recognise that China is not a threat to the peace of the world but that her peace has been threatened by the world. It would seem to me that we must be careful not in any way to approach China with any idea of hope that we can exploit them. That should be furthest from our minds. As the noble Lord, Lord Bowden, pointed out, we have certain things to offer which may accelerate the industrial development of China and, as Lord Chalfont has assured us, this development will not be a threat to the peace of the world.

If I may be permitted to enlarge on that theme, I would make one or two other comments. The first is that my long association with Chinese geologists has always left me with a deep sense of gratitude and humility. I have always found greater ease in talking philosophically with Chinese geologists than I have had in talking to German geologists. It is, therefore, clear to me that any suggestion that we who talk about the natural resources of the earth from either a cultural or a practical point of view will receive great understanding from the Chinese. They think as we do. Therefore, I have no hesitation in making, through your Lordships' House, one or two suggestions. The first is that they would understand such a comment as this: that we of the West who invented the methods of mass production of iron and steel—Bessemer and all that—have come to realise that these techniques have come to the end of their day. They are too dependent upon natural resources like metallurgical coke which have rapidly become wasting assets; and we must move into a new field of metal extraction which employs the use of electrical furnaces. Conjoined with these, you must have cheap, abundant and reliable electricity, and, in addition, an understanding of how metals are being created in the earth's crust and which can be simulated in an electric furnace.

It is this kind of technology which, happily, we in Britain have at our disposal. In fact, we are its originators. It is a new form of metal chemistry which involves metals and organic matter and, in particular, waste organic matter, even town refuse. Utilising this biochemical knowledge, we are now able to demonstrate exactly the same processes that produce pure metals in meteorites. I shall not give a lecture on meteorites; I merely mention them because our Chinese counterparts will understand this philosophical approach to a whole new area of industrial development. The noble Lord, Lord Bowden, says that they will get there anyway in the end. Why should we not accelerate their progress by placing at their disposal all the advantages that we have in this country? We know of various ideas—yet we cannot develop them in this small island—such as the conversion of coal into fertilisers, the release of biogenics from coal which accelerates plant growth several times, the release of trace elements on a balanced form in coal to create fertilisers. Why should we not give to the Chinese all this academic information which they can use, although we cannot do so? There would be no better way of cementing friendship without any trace of political influence involved by giving to them the products of our developments in this country and in Europe as a whole.

This brings me to another important point which is their sad belief that they are going to be invaded again, and they will need more food and more iron and steel for defence. I have mentioned new methods of accelerating the production of iron and steel and the creation of iron and steel furnaces which are different from things one sees bandied about in the Press today. They do not want another disastrous type of steel plant such as we have in South Wales, shockingly out of date and of limited life. What they want are the arc smelters which we can produce almost overnight for them.

When one looks at China as a vast exposed area of the earth, one has to remember that the great divide between China and Russia is the Himalayas. This is not without significance because the southward push of the crust which created the Himalayas has engendered into the rocks of China a tremendous network of minerals of great variety, far greater than is to be found in the more placid areas of the crust of Russia or America—a little like what happened in Cornwall but magnified a million times. So one can see in China the potential of all kinds of mineral resources. China need not be short of one single metal, it has the lot.

One may ask: "Does Russia know this?" It may come as a surprise to your Lordships that the geological maps of China are far better than the geological maps of America. They know where everything is; and the kindest thing that we can do for them is to go out there and accelerate what they will eventually get to know anyway. I was delighted that the delegation to China was led by the noble Lord, Lord Rhodes, because he symbolises everything that is British. I am not surprised at the success of this delegation. Those who have not read the report should do so because it is a remarkable one. In conclusion, I am delighted that the noble Lord, Lord Goronwy-Roberts, is to reply. He too symbolises to the Chinese all the best that we know as British.

5.44 p.m.

Earl DE LA WARR

My Lords, before I begin my speech I must declare an interest. My company sells flight simulators to China. Why this interest has to be declared will emerge during the course of my speech. I should like to join others in thanking the noble Lord, Lord Rhodes, for his splendid initiative which comes at such a timely moment. The history of alliances throughout the ages has been one, whether between nation States or great empires, of kaleidoscopic shifts. History tells us that normally these shifts in alliances have not been brought about by a community of ideologies; they have been brought about by mutual convenience and mutual self-interest. Some of them have been warlike and some defensive.

We are privileged to be watching the start of one of the great shifts of interest in history, something that will be a watershed, something that can alter the face of the whole world if only we in the West are astute enough and sympathetic enough to grasp the hand that has been held out to us. The context of this shift of opinion on both sides is the massive Russian imperialism with which we are faced. I do not think that this is the opportunity to go into this in detail. I shall content myself with reminding your Lordships that the Russians have in the field the largest land army that has ever been known in peacetime in the history of the world. I will remind the House, too, that at the rate they are producing submarines they bid fair within a short time to be in a position to control nearly absolutely the sea-lanes of the world by which we conduct our international trade. In these terms, the Western anxieties, the Western fears, have exactly the same quality as those of China. They are simply this: Both of us fear a land invasion by the Russians and at the same time a devastating sea blockade.

The only difference in our outlook is one of geography and not of ideology. For the reasons which the noble Lord, Lord Chalfont, gave so lucidly and so admirably, I believe that the case in terms of Realpolitik for helping China to at least defensive parity is unanswerable, if that is a phrase—defensive parity—which the strategists would allow. Defencewise, the Chinese want from us just one thing: they want the Harrier. Your Lordships will now realise why I felt it proper to declare an interest. I beg the Prime Minister to hurry up with making up his own mind and that of his Cabinet. I beg him that he will not attach to our agreement to supply them terms that are too onerous for the Chinese to accept—terms either commercial or which will cause loss of face. We cannot afford to wait very long for this decision to be taken.

Before I leave the strategic aspect, I should like to ask the noble Lord, Lord Goronwy-Roberts, whether he can help us over one matter which is bound to arise; that is, the running of the COCOM list. We all know that this list is an integral part of the Atlantic Alliance and that it is directed against the Communist countries. I know it will be difficult for the noble Lord to answer at this stage because there is a hypothetical element; but, if he could give us some indication of how the Government could deal with this not uncomplicated situation, I think we should all find it very interesting.

If the supply of arms represents the bricks of a defensive alliance, then surely trade is its cement—the thing that binds it together and gives it a lasting life— but I think we must remember that the Chinese trade approach has not been to the United Kingdom alone. We already know that they have an agreement with Japan. They have been to the whole of the West. We are not regarded, as I think the noble Lord, Lord Rhodes, advised us, as number one in terms of suppliers. I believe it was only two or three weeks ago that a trade agreement was concluded by the Chinese with the French, who are very adept over the supply of goods and know-how, and also sometimes at forms of undercutting, of which we do not always approve. So, my Lords, in short we have to pull our socks up if we are to get our share of trade, our share of the export of goods and, perhaps more importantly, our share of the export of know-how of which we have so much.

I hope that your Lordships will not think it immodest of me if I tell you something of my own company's experience. We have been trading with China for some eight years and have been selling them flight simulators for their civil airlines. We had to find out for ourselves the mechanics of trading with the Chinese Government. We are now dealing with one of their Government buying agencies —specifically the engineering agency— and we have found that now we know the ropes it is all quite simple. We send our high-level salesmen and service engineers to look at our machines and see that they are looked at very regularly. We are discussing with them at this moment the supply of simulators for rather more modern aircraft; up till now it has been the 707 and the Trident.

We heard from the noble Earl, Lord Selkirk, and from another noble Lord— I have mentioned this myself —something about the importance of the supply of know-how. It may interest your Lordships to know that our nearly wholly-British-owned television station in Hong Kong is during the next few weeks sending a delegation, led by its managing director and top engineers, at the request of the Peking Government to a number of big cities all over China, some of which are not normally visited, in order to see what they are doing and, I believe, to give them advice on how they may expand and improve their service. I believe that this is a very real thing which is being done now in supplying in the field of communications a form of know-how to China.

This leads me to devote just a few minutes to Hong Kong, about which, if I might say so, too little has been said in this debate. Legally, Hong Kong is a British Crown Colony, but in fact it is something pretty different. It is a sophisticated financial and trading centre. I am sorry that the noble Lord, Lord Rhodes, called it "an anachronism", for I do assure him it is no such thing. During the course of his speech I noted he said he had come to admire it, but it seemed to me that his admiration had a certain amount of reluctance about it, if I may say so——

Lord RHODES

My Lords, let me squash that straight away. I am an enthusiast. I have been there 12 times. I admire them for their initiative and their enterprise. With regard to the word "anachronism", I think that most colonies are anachronisms nowadays.

Earl DE LA WARR

My Lords, I am delighted to hear that I am largely wrong, but perhaps I could confine my comment to noting with regret that he should have used the word "anachronism". However, the noble Lord did say—and I should like to repeat this because it was a phrase told to me for the first time while having lunch in your Lordships' House with that great man, Sir Lawrence Kadourie—that in Hong Kong they regard themselves less and less as a colony and far more as what has now come to be known as "the free zone of mainland China". If your Lordships will think out that phrase, there is indeed a wealth of meaning behind it.

On their own account, by themselves and without any encouragement from this country, in the last few years Hong Kong has been growing very much closer to the Chinese. As some of your Lordships may know, the Chinese—that is, Communist China—have over 100 department stores in Hong Kong. Some of your Lordships may know already that the Bank of China has nearly as many branches in Hong Kong as does the Hong Kong Shanghai bank. They have a machine tool factory and they are just about to build a ship-repair yard. On the other side of the penny, Hong Kong is becoming a rapidly increasing outlet for China's exports. It is becoming a rapidly growing provider of finance for internal Chinese products. Indeed, there is at this moment a big project being looked at for the provision of a chain of luxury hotels in all the main cities in China. This is all coming from Hong Kong.

Finally, I should like to refer to something mentioned by the noble Lord, Lord Rhodes; that is, the magnificent deal which is just on the point of being signed, which has been the dream for 30 years of that great man Sir Lawrence Kadourie, who is the chairman of China Light and Power, by which China Light and Power will build a power station in Hong Kong which will get its coal from mainland China and in return will probably supply electricity for nearly the whole of the Kwantung Province. It is to be hoped that much of the equipment for this station will come from the United Kingdom. The Hong Kong Standard reported today that this agreement was just about to be signed, and there is a quotation from Sir Sidney Gordon, the deputy chairman, who is also my own chairman in Hong Kong, in which he confirms that this is about to happen.

What a great exercise in tripartite effort! Hong Kong is highly crientated towards the United Kingdom. Believe me, my Lords, it will play an enormous part in the expansion of trade with China, which has been the subject of this debate. But we can rely on the British connection only if our products, our services and our know-how are at least as good as those of our Western competitors, and I hope that this lesson may not be readily forgotten. So let us ensure that, both politically and commercially, we in the United Kingdom take the fullest possible part in this great new twist in the affairs of the world.

6.1 p.m.

Lord DAVIES of LEEK

My Lords, I apologise to the House for having to leave. My usual custom, if I take part in a debate, is to pay courtesy to the other speakers and sit through it, but I had a special meeting of the Procedure Committee which I had to attend. Hence, having made my apology, I shall not feel guilty for having missed some of the excellent speeches.

After listening to the noble Earl, may I say that his contribution has been constructive and full of realism. I suggest to noble Lords that they pop into the Library and pick up a copy of Le Figaro, and read the article by M. Robert Lacontre "La revanche de Teng", But what is happening? At the end of the article, M. Lacontre writes "It is one of the great mystifications of the century".

The noble Earl asked a pregnant question. He asked: What will now happen to COCOM? It is a long time since I tried to get Tridents sold to China. It is a long time since I had a discussion at the Foreign Office. Having knocked around that part of the world, I was often told to take a slow boat there and stay with those little yellow men. Suddenly, everybody is on the bandwagon, and I hope that a wheel does not come off. We could not sell the Tridents because I suggested that they get a second-hand Trident from Pakistan, which they did. I never made money out of East/West trade, and I did my job full-time as a Member of Parliament. But there were opportunities to sell motor boats. "No" said COCOM. "No", said the United States of America. "You can only sell a motor boat with a forward screw. It must not be able to reverse". So we lost the opportunity of snuggling up to this mighty nation during its great Marxist period. Probably, we are all Marxists now.

Lord O'HAGAN

No.

Lord DAVIES of LEEK

My Lords I did not ask for any contradiction. I asked for acceptance of the reality that we are snuggling up to the Marxists now. That is a fact, so do not say "No", unless you are going to agree that we have an open door. It has been pointed out by the noble Earl, who has experience, that China is trading with other nations. There are 150 other nations which are now on the Chinese bandwagon, and the British public, the British trade union and Labour movement, British capital and the bankers must realise that there is no sunshine movement into China for our goods, unless they are the tops, of first-class specification and delivered on time. If the British trade union movement and British capital want this market, they must honour contracts on time. We are not playing with a nation that is half soaked. It is a nation of the most shrewed people in the world.

I have had the opportunity over the years of knocking all round China from Outer Mongolia to the borders of Tibet, and seeing these people and admiring them, though not agreeing with all. They, too, can be cruel, just as we accuse the Russians of being cruel. Their prisons, too, have had political prisoners. Now those prisoners are being released. So the first thing, if we are doing this, is to have a conference of COCOM. It is no good blinking.

When we had a Question last week about selling a sophisticated piece of a computer to Russia, I wriggled in my seat behind the Front Bench when I found that the Answer was that we could not sell it. Yet only a couple of weeks earlier, Russian airmen and American airmen were fraternising 1,000 miles up in space in the most sophisticated machinery in the world. Come on, come off it, unless we still want to walk about in the cold. If we do not sell to them, West Germany will. Let me give your Lordships a concrete example. We lost the penicillin market because it was considered strategic: the Chinese ultimately manufactured it themselves. We lost the ballbearing market, because we would not sell them ballbearings. They were strategic.

Foster Dulles and his ilk helped to keep this alive when he composed the domino theory. What has happened to the domino theory, under which all the Chinese were going to swarm, in hordes —those were the words then, not a great race—into Malaya and Indonesia. What has gone wrong? It is history . It is one of the quirks of civilisation that the friends of the last war are the enemies of the next. That is what seems to happen in the history of mankind. Man is a strange creature one of the nastiest animals on earth, which fouls its nest and destroys beauty. It is time that mankind steadied up, before we destroy this race of human beings.

Lord GLADWYN

My Lords, is the noble Lord really correct in his explanation of the domino theory? As I understand it, the domino theory was not the idea that the Chinese would invade all the surrounding States, but rather that, one by one, the neighbouring States would become Communist.

Lord DAVIES of LEEK

That is right, my Lords. That was the domino theory. The finger that pushed the dominoes belonged to the Chinese, so that they all fell down from the impetus of the Chinese. Thank heavens! for the then Sir Anthony Eden. I remember the Geneva Conference only too well, where there was a civilised Chinese leader, Chou En-lai. We had an agreement on peace. It is in Sir Anthony Eden's book Full Circle, on I think, page 113, which tells how he dealt with Dulles whom I called the Flying Bedstead of the Pacific. Every time he visited somewhere, he wrote a book about it after 48 hours there. This was a bad period and the advice from the Foreign Office and from the French was bad.

But having said that, I will pay tribute to the Foreign Office. Let us remember that during all that we put the steadying brake on the worst of America's financial approach to Asia. It was Ernest Bevin who, despite all the others, recognised the Chinese and we had a chargé d'affaires here in London when most of the Western world had not done it. That was a period in the Foreign Office when there was a common-sense approach. I shall not go into retribution, although I could. Now we have changed, thank God! But where are we to go from here? I am delighted with these improved relations, and I am more than delighted that my noble friend took the initiative. But I will tell your Lordships what worries me. If they did not want the IPU to back a visit to China, because the Russians are members of the IPU, let us make it clear that we cannot sever all our relationships with the mighty Soviet Union just because we are going to sell a few jump jets to China, unless we find that they are completely daft. There would have been no Europe as we understand it today but for 20 million dead Russians after Stalingrad and 35 million injured. Do not, in all the euphoria, forget that the Russians got the Jews out of Buchenwald.

Let us get the balance right. The Russians are no angels, nor are the Chinese; and the British are certainly no angels. Let us adopt a manly approach to the problem. Let us sell the jets. Let us get rid of these silly, so-called strategic limitations on sales. Let us improve our labour and capital relations. I do not want to name barks, but there is a magnificent opportunity for banks with courage—Warburg, Lloyds and others— to give trade credit to the Chinese nation. The noble Lord spoke of the imbalance in trade. The answer is easy. The Chinese do not have the currency. They need currency. Therefore, I pay a tribute to humble traders like Mr. Timberlake, with his monthly letter—which has been going on for years—on trade with China. Nobody has taken much notice of these traders, but they have courageously gone on building up little bits of trade and large amounts of trade and getting a foot into this market.

However, we should have no illusions. Britain is no longer a great Empire. Our goods will sell only on their quality and merit. There have been great changes since the death of Mao in 1976 and the death of Chou En-lai in 1976, and also since the Nixon period. Whatever I may think of that gentleman, I do not intend to make any derogatory remarks about him, or to go into other issues. However, that was a vital leap forward which enabled the West to make new contacts with China. I should be a fool if I were not prepared to admit the greatness of that piece of diplomatic—not expediency, but greatness at that moment in history. Whatever else may be said of President Nixon, that is a medal which he can worthily wear on his chest.

We would not sell rolling stock to China, and that makes me laugh. I went by train from Peking nearly to Hanoi in a first class carriage. We could have sold China rolling-stock from Crewe, but, no, it was strategic. Therefore I travelled in comfort from Peking right to the borders of Hanoi, a four and a half days' journey——

Lord BROWN

My Lords, railway carriages have never been listed as strategic by COCOM.

Lord DAVIES of LEEK

My Lords, my noble friend should not argue with me. Rolling stock—must I repeat it?— was on the strategic list.

Lord BROWN

No, my Lords.

Lord DAVIES of LEEK

My Lords, we would not sell rolling stock to China, but the Hungarians did. What point is my noble friend trying to make?

Lord BROWN

My Lords, I am correcting a mis-statement.

Lord DAVIES of LEEK

My Lords, if my noble friend believes that, we are both making mis-statements. Why was this? It was the same bad period. We missed the opportunity to go and see what they wanted. We could have sold millions of 2¼ horsepower pumps to save women carrying baskets with water in them from the rivers. We sold a few of these pumps in Laos, and I watched them working. They had a couple of soldiers guarding one. It was beautiful but pathetic. Those pumps would take that kind of labour out of village life. We could have sold millions of them, but they too were on the strategic list. We had to argue with COCOM. But let us skip that, since I am skipping three-quarters of my speech to please noble Lords.

Let us get a few facts about the EEC on the record. I want to pay a tribute to the noble Lord, Lord Soames, although he is not in the Chamber, for the efforts which he made. The EEC does not, however, mean something for nothing. Conditions are made and they have to be kept. Since the cold war we have moved from table tennis diplomacy to across-the-office-floor diplomacy, which is a much more peaceful and hopeful sign for the world. Let us hope, therefore, that the sale of the vertical take-off fighters will not upset the Vienna talks and the movement towards peace in the Western world.

We cannot sacrifice the whole of the Western world to make a success of an attack on Russian Communism. What kind of civilisation do noble Lords think would be left in the world if there were a war in which 400 million people could be pushed into the earth? For Heaven's sake! wake up. Do not adopt that philosophy. According to an article in Le Figaro, Robert Lacontre says that Teng Hsiao-ping thought that Mao had become metaphysical. We have de-Stalinised Mao, and now we are forming a system of society that socialises the losses and privatises the profits in China, too. Think that sentence out! The Chinese businessman is one of the most honest of his kind in the world when it comes to paying his debts. So are the Russians. The old Manchester Guardian always used to say that Russian debts were paid on the nail. Chinese debts are also paid on the nail. We are dealing with a nation that is sophisticated when it comes to making payments. It is a nation of merchants. Therefore we must pull up our socks.

If I may speak about the EMS, there is a mythology regarding money which we have had since the 1930s. I have studied the May report for that year. One can pick it up today and read the same facts about imports and exports. The value of money depends upon the honesty of the workers, people and capitalists in the country in which they live, and nothing else. "A good day's work for a good day's pay" is an old-fashioned phrase, but it is the basis of the security and soundness of our monetary system. We can disregard crawling pegs, snakes and all the marvellous expressions that the theorists put forward. That phrase is the basis of our security, and we can achieve it by means of trade in the Oriental parts of the world.

I shall end by saying this. The Chinese are poets, and their invective is wonderful. The very phrase "The Gang of Four" makes your back bristle straight away. The radical leaders—Chiang Ch'ing, who is the widow of Mao, Wang Hung-wen, the Vice-Chairman of the Communist Party, Chang Ch'un-ch'aio, a Vice-Premier and Yao Wen-yuan, a member of the politburo—were all in the Gang of Four. I hear people running around the Lobbies here shouting "The Gang of Four", but I do not think that three-quarters of them know who the devil they were, or what they did, or why they got into trouble. Let us skip all the euphoria, all the expressions. Despite everything, Mao will always be thought of with other great leaders as one of the leaders of mankind who changed world history and helped to topple the American, British, French, Portuguese, Spanish and other imperialism in South-East Asia.

A tribute was paid to China by Sir Harold Thompson, a Fellow of the Royal Society and Professor Emeritus of Chemistry at Oxford, and by Lord Bessborough, in excellent lectures to the Royal Society of Arts at which I think my noble friend was the chairman. They were excellent lectures. In his lecture Sir Harold said: A struggle developed in the Academy of Sciences between those who supported Mao and those led by Liu Shao-chi whose arguments were that scientific research was not in line with the country's needs". That period has now gone. Sir Harold also paid a tribute, as did my noble friend, to the improving standards in the universities and of course Truman had the last word. There was a time when Chiang Kai-Shek was a friend of Britain and Truman said what he thought—we can read his life and his book. He said: I never changed my mind about Chiang and his gang. Every damn one of them ought to be in jail, and I'd like to live to see the day they are … That is rough talking for an American President and if we had not listened to MacArthur we might not have had the same Chinese Communist trouble and we might not have had the dead in Korea. I stood in Korea with my hat off one evening when the sun was sinking in the West over the graves of the Gloucesters and the others: what did they die for? MacArthur was going over the Yellow River and then it was through Clement Attlee and the great Winston Churchill who flew out to stop the dropping of the bomb over the Yellow River. After that MacArthur was sacked and this is what Truman said about it. MacArthur, the General, dominated all thinking and Truman said: I fired him because he wouldn't respect the authority of the President. That's the answer to that. I didn't fire him because he was the dumb son of a bitch, although he was, but that's not against the law for generals. If it was, half to three-quarters of them would be in jail. That's why when a good one comes along like General Marshall—why you've got to hang on to them and I did …". We do not talk like that about our Generals or our Admirals—God bless them!—but the Americans have a different idea. They allow the Generals and the Admirals to dominate their thinking. Do not let euphoria dominate our thinking about China. China is a great nation, she will need our help but she has 150 other nations who are willing to help her if we do not. If we want to help her, work well and do well, because you will get nothing for nothing.

6.23 p.m.

Lord GLADWYN

My Lords, I could not agree more with the noble Lord, Lord Davies of Leek, in regard to what he said about President Truman. I always thought he was the greatest American President, far better even than his predecessor, and I had personal experience of some of the things that he said and did.

I should have liked very much to take up what the noble Lord, Lord Soper, said about the necessity "or pacifism. I think that one day we ought to have a debate on that—whether the theory of absolute pascifism is valid or not, and if not, why not—and perhaps on that occasion there might be more of the right reverend Prelates on the Bishops' Bench to explain the view of the Church. I do not myself altogether share the pessimism of the noble Lord, Lord Soper. I think that the theory of Arthur Koestler, that there is something inherently vicious and aggressive and violent in human nature which will actually lead it to destroy itself, like the brontosaurus, is derived from Oswald Spengler, who said that man is a beast of prey, a Raublier, rather deriving in its turn, I think, from Nietsche. It is a philosophical conception, but I do not myself believe that it is true. If it were true, then of course there would be no use being a pacifist because everybody would be eaten up by the aggressive human beasts irrespective of whether they were pacifists or not! So I do not believe in that, nor do I believe that the nuclear war is inevitable. I think it is quite possible that the horror of dropping the bomb—although of course one might be dropped by mistake—will probably put people off it or at any rate the great Powers, and they will never employ this horrible weapon. I think therefore that it is something that will ensure, if not peace, at least nuclear peace.

Having said that, I should like to thank the noble Lord, Lord Rhodes, for initiating this debate. I read his report, to which my noble friend Lord Mackie of Benshie contributed. In fact all the members of the delegation expressed their view and I found it immensely interesting and stimulating. Indeed, I believe the impressions gained by that delegation were not very dissimilar from those of the mission with which I was associated, namely, that led by the noble Lord, Lord Chalfont, when we arrived on the scene a little later. Anyhow, since I was never in China before, your Lordships might, for the next 10 minutes or so, bear with the first impressions of a complete non-expert. It is said sometimes that first impressions are the best! Let us hope so.

Well, the first and the chief impression that I received was the absolute, or apparently absolute, sincerity with which nearly all the people we met—and of course they were either people who were attached to our mission or officials of one kind or another—violently criticised the cultural revolution, which was usually associated, for fairly obvious reasons, with the activities of the Gang of Four. From what they said, and indeed from what I have read elsewhere, and notably in the highly interesting and brilliant book entitled Chinese Shadows by a Belgian sinologue called Simon Leys, the cultural revolution was a national disaster amounting in certain districts almost to a kind of civil war. Very little was heard about this disaster in the West, and indeed I think many outside Chinese specialists were often led to believe, and possibly from ideological motives, that all was well and that the new China was going from strength to strength. If they thought that they were certainly wrong.

Basically, the cultural revolution seems to have represented a continuing effort, especially after Chairman Mao had been, as it were, affected by his age, to impose an ideological straitjacket on the whole Chinese nation which it was not willing to accept, and for some time that rigidly Marxist philosophy was reinforced by a sort of "emperor worship" or a reversion to the most ancient Chinese concepts. But after the death of Mao that magic obviously could no longer work. In any case, the totalitarian and levelling prejudices, if they may be so described, of the leaders of the cultural revolution evidently led to increasing discontent in all sections of the people, especially among the intellectuals. Perhaps this first impression was wrong, but the main thing I noticed was literally the passion with which the critics of the old order expressed their views.

Naturally, it cannot be denied that under the Maoist régime, whatever its failings, there were considerable successes, and the rigorous Marxist policy was in fact tempered from time to time, particularly perhaps under the influence of the still discredited Liu Shao-chi. In particular, of course, food was produced in sufficient quantities to feed the population, the health of the people also seems to have been excellent on the whole, fairly successful efforts were made to keep the birth rate down and some of the highly labour intensive public works were indeed remarkable. But it must be admitted that all this was at the expense of almost all the amenities of life and, above all, of every vestige of freedom. By all accounts too, industry was pretty inefficient and, as we know, the armed forces were deprived of all kinds of modern weapons and thus remained, and still remain, very largely out of date.

So the real question now seems to be whether the new and welcome emphasis on freedom will be compatible with the huge new national industrialisation programme which is to be carried out, it would seem, largely with the aid of foreign money and no doubt also with the aid of foreign techniques or technicians. In theory there is no reason, surely, why this should not be so, even though we may have doubts that the progress will be as rapid as the present Government appear to think. It all will depend, presumably, on the general maintenance of order. We must all wait and see how the new political freedom, for such it is, is going to be translated into reality. There can be very little doubt, as I think has already been said this evening, that a kind of communism will continue, and the main question is, can it be Communism with a human face?

I think it was Napoleon who said that China was a sleeping giant and had better be allowed to go on sleeping. I believe his actual words were: C'est un géant qui dort; laisse le dormir". I feel that, ever since the Communist victory in 1948, the Chinese have been such a giant, not wishing to have any contact, if possible, with the wicked outside world and only asking to be let alone to work out their own salvation. During the 19th century and right up to the end of the Second World War foreign Powers did their best to, as it were, drag China into some form of industrialisation on their own terms; that only produced, as we all know, misery and chaos. China then went once again for 20 to 30 years into isolation; and now, after about 30 years introspection, she is certainly striding on to the world stage, with what actual result nobody can possibly say. It seems that she is looking for help to Japan and to Europe. I should hope that there will be general agreement in this House, at any rate, that we for our part should do anything we can to help her in her forward march.

The second impression I had, and it was a very definite one, was the immense fear which all Chinese seem to have of, I will not say the Soviet Union, rather of the Russians. They all said that, of course, World War III was inevitable, but after considerable arguments General Wu, to whom Lord Chalfont referred, said, "Well, it is inevitable, but it may be postponed", which comforted us to some extent. I said, "You really must not say, even if you believe it, that World War III is 'inevitable' because that has a very counter-productive effect on your European friends. "They said perhaps they would modify that; but they did say, and what I think Wu's view is, was that although World War III will almost certainly come it will probably not be a nuclear but a conventional war. If you think that out there is a good deal to be said for the general's conception; anyhow, I would have thought that myself.

In any case, since they are obviously terrified of the Russians, one of the things they want is to be helped in the build-up—and they cannot build them up themselves very much because they have not enough money—of their armed forces; enough, shall we say, to slow up any possible conventional attack on them from the North, to slow it up before the main parts of the Yangtse Valley, and so on, can be occupied. Even if it is occupied their argument is that the Russians would eventually have to go back to Russia, but that is another matter. Clearly what they want to do is to slow up this potential conventional attack. One of the things they have set their hearts on for that purpose is the purchase from us, because we are the only people who produce it, of the Harrier so-called jump jet aircraft. This cannot possibly be described as an offensive weapon. It would be no good in the almost inconceivable event of China attacking Russia. It could only be of any use if the Russians conventionally attacked China, and that is why they want it.

No doubt we will have to get the formal agreement of our allies, notably the Americans, but I believe that the Americans are willing. Perhaps the noble Lord who is to reply will tell us if that is so or not. Possibly the West Germans may have objections on the grounds that such a sale might irritate or provoke the Russians; more particularly, as Mr. Brezhnev has said, our relations with the Soviet Union would suffer if the sale was effected. I hope and believe that the Government will not be influenced by such considerations. Harriers are a weapon which might be used in the event of some invasion of China, but not otherwise. So I hope that the Government will tell us tonight that there is nothing to prevent a sale as far as they know.

The idea that the Russians are suffering from a sort of claustrophobia and that if the Chinese are built up in any way they may one day feel bound to strike out, I find rather silly. How can you suffer from claustrophobia when you dominate the world from the Elbe to Vladivostok and have a very considerable chance of extending your influence right through the Middle East and then on to the middle of Africa? I hope when the Minister comes to reply he will tell us that the deal regarding Harriers is probable in the months to come, and that in any case aid to China in the difficult task of building up their armed forces is desirable, Soviet threats or no Soviet threats. Surely it is a good thing in principle for Europe to find firm friends somewhere, and I may say that any rebuff to the Chinese in regard to Harriers, which I think could very easily come about if we failed to sell them, would be a very serious matter. Why should we do it when this friendship is, so to speak, offered us on a plate?

I only add in conclusion that I, like my noble friend Lord Chalfont, very much appreciated the extreme friendliness with which we were greeted everywhere, even in places like Irumch the capital of Sinkiang where we saw the immense agricultural developments beside the Tienshan mountains and everybody working with sickles in apparent contentment. There, when we went into the stores, everybody flocked around and were interested and anxious to talk. There was enormous interest and friendship which I think was not just put about by the Government; it does exist and we ought to profit by it. We do not know, of course, what is really going on behind the scenes. What foreigner does? But that the largest, and in some way the most intelligent and most hardworking nation in the world, is now embarking on a new course seems, at any rate to us on these Benches, to be certain, and I believe that we in the West should do our best to help it on its way.

6.39 p.m.

Baroness WARD of NORTH TYNE-SIDE

My Lords, I can assure you that my contribution will be very brief, and I think a little odd. First, I should like to congratulate the noble Lord, Lord Rhodes, on his most excellent speech and all the information that he gave us. The reason I put down my name to speak today was because during the war I was sent out to China to help them. I think I am right in saying that none of the people who have been out to China fairly recently or during the last few years were out there at the time of the war. I remember very well, indeed, when I was in another place that we sent a small Parliamentary delegation out to China. The Chiang Kai-Sheks were, of course, in power then, acting like warlords in their administration, and Madame Chiang Kai-Shek was asked whether she thought it was a good delegation. She said, Yes, it was a good enough delegation, but there was not a woman on it. So while I was in another place our Whips of that day rushed round, and they suddenly said to me, "You go!" Therefore, I was flown out and it was a very dangerous flight, because of course I and the passengers who were with me were chased by the German airforce; when we flew over the hump to Chungking, with the brilliant American pilots, there I was. Therefore, I reached there chased by Japanese planes and, on the whole, it was rather a frightening period.

However, like the noble Lord, Lord Rhodes, when I finally arrived I admired the Chinese. By that time, of course, Peking was in Japanese hands. They had great problems, but they remained extremely friendly towards us. I can remember so well the first speech which I made to them after my arrival. I explained to them how short of everything we were after fighting the Battle of Britain. They understood the situation so well. I have always been delighted to have been a friend of the Chinese and I hope that I shall be for a long time to come.

I am rather sorry that I am now too old to return to China because I should like to see the development that has taken place. During the debate mention was made of the immense new bridges that have been built over the Yangtze. I remember that when I was in China we used to travel about in a bus and the bridges were so fragile that we never dared let a bus cross them with the passengers inside. We always had to get out and walk over the bridges. However, the Chinese were beginning to learn and it must be remem- bered that they had never really come into contact with all our technical developments.

I also remember that at that time they were just beginning their education system. I was asked to go to some of their universities which I was extremely delighted to do. However, the people who came did so not to listen to me, but to get food because the Chinese at that time were very short of food.

I have enjoyed listening to the debate and I am very glad that in the future we shall be able to help the Chinese in their magnificent development. We have had a very long debate and there is nothing more that I should like to say, except how much I admire their success and how much I am delighted to know that they will continue their friendship with us. It is a magnificent country and the Chinese will do much towards helping to bring about stability in the Far East. It is marvellous to have a friend like China. I am delighted to have been able to listen to the speeches that have been made this evening, and close by saying goodnight and God bless the Chinese.

6.43 p.m.

Baroness DENINGTON

My Lords, I am sure that we are all deeply grateful to the noble Lord, Lord Rhodes, for putting down this Motion provoking this interesting debate. Just a year ago, having always had great interest in Chinese matters, my husband and I were trying to understand from reading articles and newspapers what on earth was going on in China. During the ensuing year there has been a great deal more information, but at that time there was very little. We decided that there was nothing to do but join a study tour as a tourist and in that way try to have some kind of look for ourselves. It is because of that experience that I am on my feet now.

Noble Lords and the noble Baroness, Lady Ward of North Tyneside, have referred to the modern developments such as bridges, hydro-electric schemes and irrigation schemes which have taken place. They are all extremely wonderful, but basically China is still a peasant nation and that is something that we must never forget. The Chinese toil incredibly hard and they do so with their picks and their shovels, because there is no mechanisation at all. The removal of mountainsides to transform tiny narrow terraces cannot be achieved mechanically, but only by human labour. Those narrow terraces are changed into vast open fields where they can, when they have the wealth, put a tractor. They move mountainsides, they channel water and they fill in gulleys. They are revolutionising and entirely changing even the face of nature to meet the needs of man. It is all incredibly impressive. They are planting mountainsides, which up to now have been barren, with fruit trees, mulberry trees and so on. I stood and I looked at all that they were doing and thought to myself: What motivates them to work so hard?

The answer is that for the first time for centuries they have been freed from poverty, depression and the oppression of the landlord who has taken most of their crops—crops being their wealth. They are free for the first time from the threat of hunger. We met a man who, as a young child, had eaten the bark of trees during the famine and had been sold by his parents. Parents sold their children and their wives to people who were able to feed them because that was the only way of keeping them alive. That man is now about 70 years old—but it is hard to judge the age of such people when they work so very hard. Those changes have taken place not in human memory but in the lifetime of one man.

Mao, of course, distributed the land to the peasants, and that is the spark of the motivation. They must provide from their crops a certain quota for the State to feed the city people and so on. But after that the surplus that arises from their labour can be sold for the benefit of their own commune and their personal benefit. We were very interested to learn that they had money in the bank, that by their standards, they are becoming wealthy, and that they receive interest on their money in the bank. That was a revelation to me because one could not find that out from anything that one read. Having changed the face of nature and provided these wide open fields, they can now, with the money that the commune makes, get a tractor. There may be only one for miles around, but there is a tractor relieving the people of terrible human toil day in and day out. That illustrates the changing face of China.

There is an absolute ferment of activity taking place in the countryside to the people's obvious great satisfaction and pride but they are still retaining their basic values. The rhythms and basic relationships between man and man and man and nature give satisfaction, balance and stability. Now this basically peasant nation is in a tremendous hurry to equal the living standards of the West, to mechanise and to be equal with any of us. For far too long they have been cut off from the world and that is not entirely their fault. I think that we in the West have a good deal of responsibility for the fact that the Chinese were inward-looking—for example, they were not allowed in the United Nations and so on. Now they are in a great hurry. My fear is that the haste with which they want to reach our standards is likely to bring with it, or could bring with it, not only the problems from which we suffer—the problems of unemployment, of greed and of the "I'm all right Jack" mentality—but also problems arising from a new and different way of life for them, a way of life quite different from anything that they have experienced in all the centuries of their civilisation.

The rapid change in their lifestyle may so undermine their natural standards of behaviour that many of the values on which their traditional patterns are based may be weakened, and even, I found myself wondering, destroyed temporarily. We saw the sort of behavioural madness —and I can only call it that—that swept over them in the so-called cultural revolution, when they smashed things up, and they now deeply regret doing so. I fervently hope that the traumatic changes which they are about to go through— because this new way of life has hardly started yet—will not lead to violent swings in one direction or another. I think that that would be temporary, because; so great is their tradition of civilisation that after a while they would return to normality. I am really trying to say that if we see them going off the deep end—if I may be allowed to use such an expression—in one direction or another, let us be tolerant, let us wait and let us watch, and I think that they will return to sanity, as they have now.

Of course, much will depend on their leadership. It will depend not only on the political leadership but on the officials who are in charge and who, as we all know, in every society are extremely influential. I believe it was the noble Lord, Lord Bowden, who said that they seem to be aware of the problems, and I think that they are aware of the problems. Recently a delegation visited us in our new town of Stevenage and I spoke to them there. It was plain that they do see the problems. However, it is one thing to recognise the problems but another to be able to deal with them.

I see the problems facing them falling under two headings; namely, technical and social. I shall deal first with the technical side. As we have all said, we should and we can offer every help. As we have said in this House this afternoon, in helping them we help ourselves. I think that our technicians and our salesmen will need patience. Some I have met have said: "It is terrible, you go mad because you can never, never get an answer. You wait months when there are jobs waiting to be tackled, but you cannot get an answer from the top because everything has to be referred up and up". I mentioned this when the delegation visited Stevenage. They said: "Yes, we know. We are aware of it. It is a very difficult problem. It is a matter of education because we have not yet had time to educate enough people who can be given responsibility and who can take profound decisions in the localities. But we are aware of it". I think that they must be very aware of it and should move on it as fast as they can.

However, it is in relation to the social problems which I can see arising where we can also help. Many of them—in time, all of them—will move from excessive toil to very considerable leisure. I would remind noble Lords that we, who think that we have been civilised for quite some time and who think that we have been educated for quite some time, have not yet learned as a people to use our leisure well. We see far too much mindless violent and destructive behaviour all around, do we not? We hear youngsters saying that there is nothing to do—and we have educated them from the age of five to 18 or even beyond. From our experience of industrialised life I think that we can make the Chinese aware that damage can be done to society by industrial modernisation. For instance, the car is both a blessing and a curse, is it not? It can so easily destroy city life, and the Chinese should control it before it does destroy city life. Industrial pollution has killed the cherry trees in Japan, has created smog and has polluted the rivers. The Chinese must control it before it overtakes them, I and be aware of it from the beginning.

The lifestyles and patterns of their civilisation must not suddenly be swept away by building Western-style housing, because it would not be suited to their family pattern at all. I do not want to see their people what I call "pigeonholed" in warehouses, as our people are here and on the Continent. I pray that they do not allow their cities—and I think that they already worry a great deal about Shanghai—to become too big and, therefore, teeming with urban poor who have lost their social values, their sense of neighbourliness, community and all the rest. Unless they are aware of it and unless they control it, that could happen. However, I think that they are aware of it.

My husband and I went to the old capital of Sian on the silk route. The Chinese did not know who I was and I was asked by the guide whether there was anything that interested me particularly about which I should like to know. I said that I was very interested in planning and they arranged an afternoon with the city planners in Sian. They did not know I was coming, but to my astonishment they talked most knowledgeably about the London plan for its eight satellite new towns, and even about the details of the Stevenage plan. That was quite fantastic. Therefore, let us not underrate their study and what they know.

In their progress into the 21st century I sincerely hope that we shall refrain from assuming that our patterns of government are necessarily right for them. Other noble Lords have made that point here this afternoon. Maybe they can develop a non-violent society—a controlled society—that can move ahead along an agreed path after open discussion. As I said before, much will depend on their leadership. I think it will help if we allow some of the antipathy that we have to Communism not to prejudice our evaluation of what happens in the coming years. I have sensed what to me is an extremely helpful and wonderful attitude on this subject in this House this afternoon. I feel deeply grateful to have been present to understand it. As a nation let us keep an open mind and have sympathetic understanding of and give support to the struggles that lie ahead of the Chinese. Together with other speakers, I believe that China has a great part to play in the future development of mankind towards a real civilisation where violence is not a dominant ingredient. I hope that this small nation of ours will give every assistance, to our mutual benefit and our mutual honour.

7 p.m.

Lord FULTON

My Lords, I should like to say how grateful I am to be allowed to speak after the last speaker, the noble Baroness, Lady Denington, because I think that she said some things that I have felt to be missing in the course of the debate hitherto. I would be tempted to say let us call it a day: we have had a wonderful explosion of opinions and a very interesting debate, for which we have to thank the noble Lord, Lord Rhodes. But I put my name down to speak in the debate in large part out of deference to him. He conceived the project for a Parliamentary Mission to China; he raised the finance for it; he organised it, and, let me say, splendidly led it; winning the affectionate admiration of all its members and giving great and obvious pleasure to our Chinese hosts.

As your Lordships have had explained to you, one due that he firmly exacted from each member of the party was to write under a strict time limit a short piece giving his impressions of a first visit to China. Indeed, it was a request to which there was only one possible answer, and I think nobody defaulted. Although some of us—myself included—would, after three or four months, be tempted to change a good deal that one wrote at the time, I think Lord Rhodes is generous enough to be gratified by that because it is a sign that his initiative is still alive and fertile.

None of us had visited mainland China. Like the noble Lord, Lord Rhodes, I had been some 14 times to Hong Kong, but never onto mainland China. We saw only a part of its Western territories, so a proper humility is due from those of us who underwent this initiation: due as it would be from one who ventured to address your Lordships' House about the United States of America after a single visit which took in only New England and the eastern seaboard, omitting altogether the deep South, the Middle West, and the Far West beyond the Rockies.

Of course one is not conscious of China only because one spent a week in it. It is one of the great issues of modern life. It is not new in modern international politics. We have disagreed with our American allies in our appreciation and explanation of the role of China in the world, and have put forward different suggestions for its incorporation into international machinery. But there is also, apart from its omnipresence in modern politics, a great wealth and a scholarly body of knowledge and writings about it.

I am not repeating idly the basic statistic that came from Lord Rhodes early in his speech: the population of China is variously estimated at around 900 million and one in five of the human race. It is variously estimated to rise by the mid-1980s to some 1,200 million plus or minus. It seems to me that the important fact to remember is that 83 per cent. of that population is rural, and engaged in agriculture or its ancillary occupations. The noble Lord, Lord Mackie of Benshie, our agricultural expert, has spoken from his special vantage point about the quality of the cultivation that we saw on our journeys, or were shown in the large communes we visited.

The great Chinese question of the future is the question of its agricultural industry and its organisation. I am not being critical but I think we have too readily assumed, in our discussion this evening that China is just like us but minus our industrial competence. China's agricultural background is its being, and I took away that impression not only from travel but from my talks with the young men with whom we had dinner and who opened their minds to us in a very frank and illuminating way.

What shall we see in the new China that we have talked about? Is it going to be a re-enactment of the history of agriculture in North America? The noble Lord, Lord Chalfont, did us a good turn by repeating the story of Henry Kissinger about the time-span of the Chinese. If you have lived and cultivated your civilisation for that number of thousands of years, being 20 years behind is not awfully important, and that is what some people have said is the gap. We have to look forward and ask where this fifth of the human race is going in the next century. Look what has happened to America. Again I apologise for very brief statistics. There, a century ago, three-quarters of the population was rural and living on farms and now, by the application of modern technology, less than 30 per cent. of the population is rural and the farm residents comprise less than 5 per cent. of the total population of the Union.

If industrialisation is the objective—and America is a good enough example—is that what they are out for? Is that what they want to do in the course of the next century to the continent they inhabit? Do we really think that those who stood on board the ships going into New York and lifted their hands and saluted the Statue of Liberty, and all that that great nation stood for in the vision of the Founding Fathers, would feel that the exodus from the farms of the United States and the journey into California have been a realisation of that vision? Or have they not? I should be very much inclined to ask the question whether the Chinese—in my understanding of them, and I stand open to correction—really just want to go for industrialisation for industrialisation's sake.

Of course they know they have something they value, and feel that the rest of the world has not got, in their agricultural social organisation. I think they would be prepared—they said it; Lord Rhodes will confirm this—in the defence of what they have got (their Chinese nature, and Chinese history and civilisation) to lose 100 million, 200 million, 300 million, 400 million. But then there would be 400 million left not in order to become industrialised for the sake of industrialisation but for carrying on what China has stood for.

So that I think we cannot just suppose that they are saying, "Let us have industry. Help us to get industry." That is one scenario. It may be so. It may be that you have to take steps in order to defend yourself—and the Harriers may be part of them—which take you on a road from which there is no turning back. But I do not think I detected that they had already given in to the idea that that was an inevitability, and that they were prepared to make that sacrifice, or would do it.

I was reminded, in listening to some of the earlier speeches, of a tea party that took place in Oxford when I was a young don there, with the noble Lord, Lord Redcliffe-Maud, and the noble and learned Lord, Lord Hailsham of Saint Marylebone. We gave a tea party to Mr. Gandhi. He had come to England for a round table conference and we felt very sure of ourselves. He explained that we had not treated India very well—that we had left it poor—and while my memory is rather defective now and I cannot remember precisely what the average wage there was, let us say it was 2p a day. He said it had to go up to 4p, to which we replied, like dons to a pupil, "Has the world not learned that if you go from 2p to 4p you will want then to go to 8p and from 8p to 16p, and so on?" Mr. Gandhi replied, "No, that will not happen to us," and we agreed to differ. Unfortunately, he did not explain how it would be done when he said, "We are going to stop the process at a certain point."

I want to know—I should still like to find out by further exploration of the literature and consultation with the Chinese—what they feel to be at the root of the civilisation they want to defend at all costs, and in regard to which they invoke our help to hold on to. It is just possible that they might give the answer; perhaps there is another scenario to the one we have presented to ourselves in this debate. Will China, by its own choice, offer a new example and remain a primarily agricultural society, practising and improving the world's oldest industry, perhaps marginally emerging into the competition of the world's markets in manufactured goods to satisfy, for its own needs and purposes, including its defence, the means by which it will defend them, but basically remaining a people satisfied with the life of the countryside and with the values and social relationships which go with that, enhancing the traditional skills built up and transmitted over the millenia?

We have talked a good deal about the commune. It seemed to me that perhaps the commune was the best existing guide as to what they are after. In almost the whole of the rest of the so-called develop- ing world—I know Africa a great deal better than I know China—the attraction of the city is the enemy of building a sound agriculture. In China the life of the commune uniquely keeps a hold not only on the agricultural workers but on the teachers, doctors, engineers and on the other managerial and professional men and women in the satisfying use of their professional talents and skills.

It is true, and we must face it, that there are in force in the communes restrictions on the movement and choice of occupation reminiscent of our wartime restriction on engagements, orders and the direction of labour. The question is whether these are part and parcel of an underlying acceptance of the life they make possible or whether they would be rejected with increasing freedom and prosperity. The evidence of one's eyes in such a situation must be regarded with great caution. However, what I saw—I think I can say what we saw—suggested no surliness or resentment. If one offered a smile one got a warm and welcoming smile back. What seems clear beyond doubt is that Mao's Communism—this should be said with great force—is poles apart from the Marxist form of Communism in the USSR.

There can be no dictatorship of a city proletariat in today's China because no such city exists. The commune's property as the noble Baroness, Lady Denington, pointed out, is the property not of the State but of the members of the commune. Its prosperity is their prosperity. The individual may hold private property, as she said, and he may own his house and a proportion of his income may come from his own labours in his cultivation of the smaller animals and their products. There seems no room for doubt that Mao meant what he said when he proclaimed that no policy should be enforced on the communes that did not appear to them to be clearly in the interest of their members. That was a tremendously revolutionary statement which, so far as one can see, he lived up to to the letter. This is the sharp point of distinction from the organisation of the Soviet State.

Granted it was Mao's intention to intervene to prevent the new China drifting into a direction like that of Russia, what are the prospects in the future for his successors? Lord Rhodes has worded his Motion well in referring to the warmth of our country's relationship with China. Let us ask ourselves what we would wish China's part to be in the world—not what we would wish to do to China—of the 21st century. I leave it to others to discuss the questions of military power and power politics. Equally important is her influence on men's ideas of how best they should live their lives.

What has a small country like ours in common with the world's colossus? We have been for a long time at the forefront of the world's stage. We have emerged from an experience of empire that was unlike any empire produced in the history of the world by any of our human predecessors. It had a lot to be said against it that has been said, but it was not there for the making of money, it was not there to stay and it was not there to hammer into uniformity people who were created different and diverse in their talents and purpose. We have emerged from that experience, by which we were largely moulded, with a strong feeling of being different from our neighbours, whether in Europe or across the Atlantic.

That is not an anti-EEC remark but, rather, a gift we might give to the EEC— that diversity can be maintained in a form of union. Thus we are perhaps able to look with understanding and sympathy on the prospects of a China persistently inward-looking, absorbed in itself, unwilling to surrender to the uniformity of modern industrial invasion of human activity, determined to resist interference from outside, but equally satisfied with its traditional way of life, and prepared for great sacrifice, if that was necessary, to maintain and improve it.

I must confess that I gained from the contacts that I made a sense of an underlying detachment from the values of the world outside China. If there were time I should say a few words about how that is reconciled with China's appearance in Africa, particularly in the role of giving a helping hand to Julius Nyerere in his particular endeavours, in which he has greatly relied upon their assistance. How China's emergence into the world's market place—with all the convulsions that would bring it about, all her maintenance of self-containment in international organisations and international affairs—goes will be of profound importance for the rest of us. If they choose not the path of growth, like that of the super-Powers and of most of Europe, perhaps the world will be enriched in other respects by China's, and possibly India's, example. What is important, particularly for us in our present predicaments, is to learn to emulate her in the strength of her convictions that she has her own role and her own purpose.

The strongest impression left to me from so stimulating an experience is the envy—that is not the right word, but I must use it—of such a prevailing confidence. It may be that we shall take from the next phase of China, and our relationship with her, a recognition that beyond the importance of earning our living we have lessons worthy of being taught to others, which we learnt over the centuries of our own history.

7.22 p.m.

Lord POLWARTH

My Lords, we have had an extraordinarily good debate and an extremely important one; I think it has been one of the best that I can remember in this House for a long time. If I had any sense I would at this stage simply strike my name off the list of speakers. However, I do not intend to do so for two reasons: first, there is the simple point that I have come all the way from Scotland in order to speak, and it would be a great waste of the taxpayers' money if I were not to do so; and secondly, the voice of commerce and industry has been singularly silent in the debate, with the notable exception of the contribution of the noble Earl, Lord De La Warr, and I suspect of the contribution to come from the noble Lord who is to follow me.

A year and a half ago the deputy chairman of the Bank of China, Pu Ming, visited Europe and came to London. Some of your Lordships may have met him. He also visited Scotland, and I had the honour of being his host at lunch at the Bank of Scotland. It was an extremely friendly occasion. Nevertheless, at that time, so soon after the discrediting of the Gang of Four and the death of Chairman Mao, how little could we have foreseen the extraordinary opening up of China which has taken place in the 18 months since.

That visit of Pu Ming's was followed by an invitation to us to visit China, and I am glad to say that in June of this year the visit came about. In going there I had, I believe, two advantages. First, I was to go not as one of a large official mission, meeting large numbers of ministers and top officials, but in a group of only four, with therefore more time to look around and observe what was going on in general in the country. Secondly, my wife was able to go with me, which was an immense help in every respect, not least because she had spent some time living in China as a child 40 years previously, and had vivid memories of life there at that time, which she confirmed was in many respects not all that different from what she found upon going back. The visit was admirably organised in every detail, and our hosts and guides could not have been more helpful and courteous. Altogether it was a memorable and momentous experience.

Now, less than six months later, we have reached a milestone of very considerable significance on the road to closer trading relations between our two countries. When the noble Lord, Lord Rhodes, did us the great service of putting down this Motion for debate, I doubt whether, even with his prescience, he could have foreseen what was to take place here in London today. The noble Lord, Lord Davies of Leek, in a most refreshing contribution, asked, what about the banks and the opportunities for them? I can tell your Lordships that this morning there were signed here in London a series of agreements between the Bank of China and a group of the leading British banks, including, I am glad to say, my own and another Scottish bank, establishing lines of credit for 1,200 million dollars (that is over £600 million) in support of exports from this country to China. Technically, this credit is in the form of what we call deposit facilities. The British banks will deposit funds with the Bank of China here in London against specific contracts for the sale of capital goods and services. The repayment and funding of these deposits will be guaranteed by the Export Credits Guarantee Department. I believe it to be the first deal of its kind ever to be concluded with China with the support of an official credit insurance organisation.

Others have spoken of the great modernisation programme which China has set herself, and of the opportunities it gives us to increase our trade with her. Yet it was hard to see how China could import the capital equipment and the technology without which she could not possibly carry out this programme so long as she stuck to the principle that she would buy only what she could pay for by her exports and eschewed all borrowing overseas. Her fears were perhaps understandable, given the bitter experience of the burden of foreign loans in the past. I cannot resist quoting, as the noble Lord, Lord Roll of Ipsden, did to your Lordships in a debate not long ago, what one Minister said of them: He who has been bitten by a snake fears even a grass rope". Even the grass rope now appears to have lost its terrors.

In the course of our talks there in June this year we saw the first signs that the Chinese might be prepared to consider forms of overseas borrowing, provided that they were clothed in suitable terminology. When the Dell mission was there a couple of months later things had moved quite a lot further. Now it seems clear that the Chinese are ready to become involved in almost any generally accepted form of financing, provided of course that the terms are right.

I believe that the deal signed today marks a very real step forward and that it reflects considerable credit on all involved. It reflects well on the Bank of China for its pragmatism and open-mindedness in reaching this solution; and I may say that I formed a very high respect for the skill and operations of its staff in London. It also reflects highly on the Export Credits Guarantee Department for its very vital part in the operation. Last but not least, if I may say so in all modesty, it reflects well upon the banks themselves for taking the lead on this occasion and having the finance ready in advance for those with the goods to sell; and I hope that Sir Harold Wilson's committee on the City will take notice of this.

For those with the goods, the opportunities are very great indeed. We have already seen some considerable deals in the last year; Rolls-Royce, with aircraft engines; John Brown Engineering, with gas turbines; Dowty and Anderson Strathclyde, with mining equipment; and ICI in the general chemical field. Those are but a selection. However, we are only scratching the surface so far, and of course we are not alone in this vast market. Every advanced country is after it, and some countries, such as Germany, Japan and France, have a head start on us. Your Lordships will know of the enormous trade agreement signed with France the day before yesterday.

My Lords, the situation requires hard and continuous selling at a high level and constant personal contact, because it appears that the Chinese like to continue to deal with the same individual and get to know him. It requires prompt delivery, high quality and good service—we could not have had a better disciple of those than the noble Lord, Lord Davies of Leek—and the Chinese have made it quite clear that we have not always excelled in these respects. It is a highly competitive market, but I believe that the rewards can be great. Take the oil industry, particularly offshore. China has vast reserves of oil and gas which have hardly begun to be exploited, and is indeed at present exporting oil, although as she industrialises that may temporarily cease. She will certainly need to import skills, and probably equipment, too, to develop these resources, and here is a great opportunity for us to deploy what we have learned in the North Sea.

There is even now talk of accepting joint ventures with overseas companies—something that they declared completely unacceptable only a few months ago. There is the example of this deal, proposed by the American group Intercontinental, to build a chain of hotels in China, very much needed to cope with the growing number of business visitors and tourists; and, of course, the tourist trade is so important for them as an earner of foreign currency. Alongside this we are beginning to see other exchanges in the fields of education and students, as has been mentioned, of music and the arts. I believe that the BBC Symphony Orchestra is going to China next year. All of this will help to bring about a closer understanding with each other. At this point perhaps I could ask the noble Lord who is to reply whether he can tell us what progress the Government and British Airways are making on securing rights for us to fly into China, because it is of very great importance that we should have this ability.

Provided that our industry can compete, I believe we are in a very strong position to benefit from China's modernisation. The Japanese, of course, have a considerable advantage—a highly industrialised nation right on their doorstep—but memories of the past are too fresh for the Chinese to want to rely totally on Japan. The United States, for all its industrial and technological strength, is still partly under the cloud of Taiwan. So it is to Europe, and to us as a European country, that China most naturally turns as an ally, not just in the military sense, to maintain the balance of power against what she sees as the menace of Big Brother next door—and we have heard from experts on this—but in the industrial sense, too. But do not let us fool ourselves into thinking that we can have the advantages of such an alliance if we do not behave as Europeans; and I am bound to say that I do not think our position will be helped by the decision, of which we heard today, to hold back from full involvement in the European Monetary System, because of the enormous desirability of a stable currency for trade. I hope sincerely that it will not be long before we find ourselves able to join fully.

My Lords, others have talked about the importance of defence equipment on the Chinese shopping list, and I will not follow them far. Frankly, I cannot see that the Harrier and similar weapons are going to disturb the balance of military power: I think they are more likely to stabilise it. And even if readiness to supply military equipment may not be an absolute prerequisite for gaining non-military orders (and I do not believe it will be) I am equally sure that such readiness will count considerably for good in where orders are placed for ordinary trade.

Finally, my Lords, what are the chances that China can achieve this enormous advance to parity with the other developed nations by the turn of the century? For a start, I do not think we should be deluded by all the recent excitement and publicity, by things like the poster campaign, into thinking that there has been a fundamental change in the Chinese character and way of thought. I believe they are very much the same Chinese who, over the centuries, have survived the vicissitudes of dynasties, wars and political upheavals. Nor should we be under any illusions that their opening of the doors to us stems from anything other than what they see as their own best interests.

What we are seeing, I venture to suggest, is perhaps a return to a period of normality stemming from a realisation that, despite their own vastness, they can no longer remain in isolation from the rest of the world. So we have a touch on the tiller, a slight change of course towards becoming a modernised industrial nation. What the consequences will be for their system and their society, with all the implications of more material prosperity, better education and more contacts with the outside world, I think we would be rash to try to judge. But given a period of stability (and those with long and close experience of China to whom I have talked in the last six months seem agreed that there is a good prospect of this happening) I believe they could well achieve what they are setting out to do—not necessarily within their time-scale; but, then, as we have heard from others today, time is not so important a factor for the Chinese.

My Lords, if I may venture to say so, I believe that as a people the Chinese are highly intelligent, industrious, disciplined, inventive, thorough, businesslike, shrewd and civilised—and, what is more, they have a splendid sense of humour. Towards the end of the tour, when I was beginning to get the feel of the game, in the course of a visit which one is always taken on to one of their temples we saw lined up a row of four immense, ten feet high figures of fiercesome warriors with bulging eyes and brandishing large swords. I thought I would just risk it, and I said to our guide, "I suppose those are the Gang of Four!". At this they absolutely collapsed in peals of laughter, and they went on telling each other about it for the rest of the day.

Certainly on our visit we found ourselves very much at home with them on the personal level, and came away with a high respect for them. Admittedly, they do not enjoy personal freedom in the sense that we know it, but, then, they never have in their history, nor do I think they expect it. Nor, I am sure, would anything resembling our form of Western democracy work with them. Certainly from what we saw, they did not give the impression of being oppressed or unhappy as they went about their activities; and, whatever else their rulers have done for them, they are adequately fed and clothed, even if somewhat simply; they have the basic but essential medical services, and they are increasingly widely and well educated.

Bearing in mind that with all this there are some 900 million of them, a quarter of the world's population—a statistic which we must have heard from almost every speaker this afternoon, but one which we would do well not to forget—I would be inclined to put my money on their achieving their aim. For us in this country this is an enormous opportunity and challenge, and one which I think we would be most foolish not to grasp with energy and enthusiasm. Indeed, I think we ignore it at our peril What is more, we must grasp it now. A close trading partnership and a close trading alliance between our two countries will benefit not just ourselves but the entire Free World. So I hope that Her Majesty's Government will give every encouragement to the development of our good relations with China, and will do so ungrudgingly, not looking over our shoulder unduly. The noble Lord, Lord Chalfont, I think, spoke of one of those he met saying that fear was a matter of the heart. I hope we will go into this relationship as a matter of the heart, too.

7.39 p.m.

Lord GEDDES

My Lords, my intervention in this debate starts not only (as has been the case with so many other noble Lords) with sincere thanks to the noble Lord, Lord Rhodes, for instigating what I think we all believe is a topic of very real importance to this country, but also with an apology to your Lordships' House that I have not spoken here for almost exactly three years. I suspect that those three years of silence have been welcome, but I should explain that the reason has perhaps some slight relevance to this debate, in that for the majority of that period I have lived and worked in Hong Kong. Hong Kong is unique in so many ways, not least in fulfilling a role as an entrepôt and, to use a useful Chinese term, a go-between between the People's Republic and this country.

I am very grateful that the noble Earl, Lord De La Warr, has—I think, rightly— emphasised the role of Hong Kong, but I do not believe that this is the occasion to discuss Hong Kong other than as it affects our relations with China. I do not in any way assume or presume to be an expert on either Hong Kong or China, but, as I have said, I have lived in Hong Kong for over two years and, not entirely co-incidentally, I have had the very real privilege of two visits to the People's Republic in the last 15 months.

Many noble Lords have stressed the importance of China in terms of trade and international politics and defence. I would certainly emphasise most strongly that importance. In trade, particularly, we have trebled our imports and not quite doubled our exports in the period between 1970 and 1977. But, even so, the 1977 figures of £100 million and £77 million respectively are still lamentably small. It is therefore encouraging to anticipate the signing in Peking early next year of the draft trade agreement with China which foresees the expansion of trade to £4 million to £5 million between now and 1985. However, there are those who have already spoken in this debate—and I am particularly grateful to the noble Lord, Lord Polwarth, for his contribution—who are infinitely more qualified than I to discuss these topics, and I defer to their expertise.

Rather, I should like to highlight three other points: first, to emphasise the point raised by the noble Lord, Lord O'Hagan, in stressing the importance of cultural links, in which context I would rather sweepingly include the arts, education and sport; secondly, to dwell briefly—as did the noble Earl, Lord De La Warr—on Hong Kong's role relative to this context; and, thirdly, like the noble Lord, Lord Mackie, to give the personal impressions that I gained through my own visits. While cultural links will not directly contribute significantly to the most important balance of trade, I believe very strongly that they do now, and will increasingly, play just as important a role in enabling each country to gain that crucial element of trust and understanding in which trade can and will be conducted to the mutual benefit of each party.

The record of cultural exchanges between the People's Republic and the United Kingdom is certainly improving, but it has still, surely, a very long way to go before it is adequate. I do not for a moment think that my statistics are—or are intended to be—comprehensive, but merely illustrative. Visits from the United Kingdom to China this year include, in no particular order: the West Bromwich Albion football team, a call by the QE2, delegations as varied as arts, education, librarians, the National Farmers' Unions, the Press Association, television, the combined Houses of Parliament, Kew Gardens, British publishers and three from medical and scientific bodies. In reverse, from China to the United Kingdom, we have had this year a medical delegation and, separately, the director of the Peking Cancer Hospital, a group of weightlifters, geologists, mathematicians, acrobats (including an acrobatic theatre), martial arts groups and an 11-member delegation from the Chinese Academy of Sciences.

In the field of what might be called straight education, there are presently 20 post-graduate students in each others country plus, I understand, a further 50 to 100 Chinese students in the United Kingdom learning English, as against only a handful of English students studying Chinese in China. To an extent, as a result of the recent visit by the Secretary of State for Education and Science to China, the numbers of students exchanged will hopefully increase—and that must be good. However, so far as I can ascertain —and I shall be only too happy if any noble Lord or Her Majesty's Government can prove me wrong—there is a singular lack of co-ordination, certainly in this country, in organising cultural exchanges with China. My information is that the British Council——

Lord RHODES

My Lords, might I just say at this juncture that the Britain-China Centre has been responsible for a group of educationists who came to this country only a fortnight ago. They were really looking for information about the performing arts. I, myself, was host to them for several days in Manchester.

Lord GEDDES

My Lords, I am grateful to the noble Lord, Lord Rhodes. In fact, he has anticipated the very body that I was going to suggest in just a moment who might co-ordinate such a function. There seem to be so many different bodies: the British Council, the Department of Education, the Royal Society, the Ministry of Defence and I do not know how many private entities and individuals all in on the act. I am in no way decrying their efforts. On the contrary, it would be a sad story if they were not so active; nor am I suggesting that such exchanges should only be under a central Government aegis. What I am suggesting is that there should be, to everybody's benefit, some co-ordinating body—I thank the noble Lord, Lord Rhodes; and my suggestion is that it could well be the Great Britain-China Centre—who could not only be informed of all intended visits and exchanges within the broad definition I have given to the word "cultural" but could thereby greatly assist each to the benefit of the whole.

Hong Kong, partly due to being so much closer geographically, is considerably ahead of the United Kingdom in respect of such exchanges. The visits this year by the Grantham Teachers' Training College to Canton and the Chinese Cultural Treasures Exhibition and the Canton City Orchestra to Hong Kong are each encouraging "firsts" in their own field.

With humility, I have seen for myself the evidence of China's ancient civilisation —a point stressed, I am sure, correctly, by many noble Lords—a civilisation that is, of course, a great deal older than our own. Now, after thousands of years of looking inwards, China is going through a very dramatic volte face in her attitude to the outside world—and I do not just mean in that context the marked change of attitude of the last two years. In this respect and in many others, Hong Kong has, I am sure, an important role to play in Anglo-Sino relations. It is geographically part of the Chinese mainland; it is not only tolerated but is now, I suggest, positively welcomed by Peking— a change in acceptability for which the present Governor of Hong Kong, Sir Murray Maclehose, and his colleagues, deserve great credit. Its trade with China—as the noble Lord, Lord Rhodes, told us in his opening address—is out of balance to a very considerable extent: £1,000 million against £4 million.

While I am sure that Hong Kong remains anxious to redress that situation, its significance in this context is, I suggest, two-fold. First, it provides, together with invisibles earned through Hong Kong, an estimated 40 per cent. of China's increasingly important foreign exchange; and, secondly, I believe that it creates a sense of moral indebtedness. Many, including, perhaps, some here this afternoon, may scoff at this last point and I would agree that it should not be over-emphasised; but, at the risk of offending my many friends both in the People's Republic and in Hong Kong, the Chinese have long memories. In the East, and, particularly, with the Chinese, they do not forget a favour done, however long ago it may have been. Of course, the converse is also true and, while many noble Lords have already mentioned this point, I most strongly urge Her Majesty's Government to give a speedy favourable decision to Peking's request for the purchase of Harrier jump jets.

Finally, so far as Hong Kong is concerned, I would just say to your Lordships that while the United Kingdom could trade with the People's Republic if Hong Kong did not exist, nevertheless it does exist, it is a territory administered by the United Kingdom and it clearly has had and will continue to have an important role to play in cementing the United Kingdom's relations with China. In terms of trade, I suggest—and this has already been mentioned—that we should look at both two-way (Anglo/Sino) and three-way (including Hong Kong) traffic. A prosperous Hong kong is a surviving Hong Kong; Hong Kong can only survive through imports of food and water from China and those imports give China the foreign exchange to buy foreign and, we hope, British goods.

China is a country so vast that it almost defies imagination: a country of 900 million people in a land measuring, at its extremes, over 3,000 miles by over 2,500 miles. My two recent trips have taken me to Canton, Whampoa, Shanghai, Soochow, Hangchow. Peking, Tientsin and Hsinkang—but a fraction of the whole. However, even within that fraction, the topography, the wealth, the climate, the people and the language vary a great deal with one all-important exception: everywhere I went—and several noble Lords made this point—first on holiday with my wife and two small children and, subsequently with a colleague on business, our reception was always of the most friendly nature possible. The big difference beween my visits of October 1977 and September 1978 was in the increasing degree of overt inquiry. I happened to be in Peking on 30th September this year, the eve of the 29th anniversary of the founding of the People's Republic. Not only was I done the very great honour of being invited to the state banquet in the Great Hall of the People in Tie en Mun Square (I must admit, with some 3,000 other guests!) but I also had the chance to walk quite freely in the square afterwards when, for the first time as far as my British Embassy host was aware. we were approached by young Chinese who just wanted to talk English and, equally important, ask all sorts of questions about the West, including its way of life, its attitude to age of marriage, and its governmental and educational systems. The day before, I had been asked quite openly by my Chinese hosts when driving from Tientsin to Hsinkang to explain the membership and workings of your Lordships' House. I do not think I gave a satisfactory answer, but I tried my best.

I think one of the most moving and unlikely experiences I have had for many years was after our walk round Tie en Mun Square on 30th September when we stopped by the moat surrounding the Forbidden City and listened entranced to a young Chinese playing the solo part of Mozart's flute concerto. He was doing so entirely for his own pleasure. He was more than happy to talk with us openly on the musical scene in China. The effect of a fine warm autumn evening of superbly played music echoing off the walls and over the water of the moat was quite exceptional.

Particularly during my visit 10 weeks ago, the Chinese to whom I spoke were at pains to emphasise their technological disadvantage relative to the world outside them, their determination to catch up and the problems they would have in doing so in a way which would be as equitable as possible throughout the country. No visitor can hope to see or to understand China on a short trip or many trips; but he can get a much better feeling for its size and the huge problem of modernising its agriculture by the simple expedient of travelling by train rather than plane. With my family I did so 15 months ago and, to a lesser extent, 10 weeks ago. The trains were clean and comfortable but, on their own admission, elderly.

Doing business with China is certainly different and, like travelling as we did, by train, possibly full of surprises; but it can also be immensely rewarding. At the grave risk of teaching my proverbial grandmother, I should like to say that the virtues of tact, patience and trust are all-important; but at the end of the line I certainly have never done business with a country which after all the hard bargaining is over, conducts itself on a straighter or more upright basis.

In my limited experience, I know of no other country in the world where the potential for trade is greater today than it is with the People's Republic of China. In his speech on 30th September, Chairman Hua Kuo-feng spoke of the necessity of putting to use the advanced experiences of foreign countries". In my own experience, we have a first rate and very experienced team in our Embassy in Peking. In Hong Kong we have a unique advantage. In China today we have a people who, I sincerely believe, really want to be our friends. Let us use all that we know we have and a bit more besides to further our improved relations with China, not forgetting in that context the vital but unquantifiable asset of even better understanding through exchanges of people in a wide variety of fields. If asked, I for one would pay a further visit there tomorrow.

7.58 p.m.

Lord GORONWY-ROBERTS

My Lords, this has indeed been a timely debate revealing the widest interest within this House and outside in the very important question of our relations with China. We are all grateful to my noble friend Lord Rhodes for introducing it in so stimulating a fashion. The debate stems from another service which my noble friend rendered to this House and the country recently when he so ably led an all-Party delegation to China last June.

We have recently witnessed dramatic changes in China; when my noble friend mentioned to me that he had in mind to lead an all-Party delegation last June I instantly agreed wih him that this could only result in the very best gains for that country and for ourselves. May I in this connection join with him personally and on behalf of the Foreign Office in warmly paying tribute to the late Brigadier Ward who, until his untimely death a few weeks ago, served the British group of the Inter-Parliamentary Union, with such single-minded devotion.

These dramatic changes in China have led a number of noble Lords to ask for an assessment on these developments from this Box. I should like to say this much, bearing in mind what the noble Lord, Lord Chalfont, said: It is too early just yet to say anything very dogmatic about these developments. Our contacts with the new leadership show that they have taken a firm decision to undertake what they called a new Long March to modernise the Chinese economy and play an increasingly active part in world affairs. Chinese leaders want a modern, prosperous, stable and secure China and to achieve this they are determined to transform their economy and society at home and to look for new friends abroad. The recent ferment has shown that there is a widespread desire in China, to which the leadership is responding, to bring back experienced leaders disgraced in earlier political campaigns to restore norms of legality lost from sight during the cultural revolution, and to involve the Chinese people in a freer debate about the ways in which to achieve their objectives.

The leadership evidently attaches importance to maintaining order and to preserving confidence in the continued commitment to the modernisation programme. It is indeed too early to say how this new departure, this new adjustment, will take them; but the signs are that a society is developing in this vast country which will be more open, one may confidently hope, more participative and more liberal, and one with which the West should find it easier to communicate at all levels.

The British Government, along with other Western Governments, welcome China's willingness to play a greater part in the world community of which she is an important member, both in terms of size and influence and because of her permanent membership of the United Nations Security Council. We are ready to co-operate with China across a wide spectrum of activity—political, cultural, commercial, scientific and technological. The external policies adopted by China over the first couple of years have indeed underlined China's interest in Western Europe. That interest, in turn, has been partly dictated by China's determination to push forward with the rapid modernisation of its agriculture, industry, science and technology and defence—the four modernisations: everything goes by four in China, I sometimes think!—and to promote that modernisation China has decided to turn to foreign sources for much of the necessary equipment and technology. Foreign trade is being much expanded and China's formerly reserved attitude towards foreign credit and joint ventures has been considerably eased.

In seeking foreign sources of supply to assist in the modernisation of Chinese industry and technology, the Chinese leaders have turned first to Western Europe and to Japan. Their interest is reflected in the current very active series of visits, agreements and commercial contracts between their country and countries of Western Europe. The United Kingdom, I am glad to say, is playing a full part in this. We greatly welcome continued Chinese interest in improving contacts with the West, and particularly with this country, and we consider it is not only in the interests bilaterally of China and the United Kingdom but also in the interests of the West as a whole to reciprocate as fully as possible.

Both government and industry are promoting our commercial contacts with China with energy. As noble Lords will recall, the then Secretary of State for Trade, Mr. Dell, visited China in August, while delegations from both the private and nationalised sectors of British industry have also been going to China throughout this year. Indeed, over the past year the United Kingdom has received a number of high level visitors from China including the Minister for Foreign Trade, Mr. Li Ch'iang and the Minister for Metallurgy, Mr. Tang Ke, and China's Foreign Minister, Mr. Huang Hua, who visited us in October. Perhaps most significant in this context was the visit last month of Vice-Premier Wang Chen, at the invitiation of the Secretary of State for Industry. He and his team, were able to make a general survey of British industry and technology, in particular of aerospace, shipbuilding and offshore oil.

We hope, too, that Premier Hua will be able to take up our Prime Minister's invitation; and tomorrow we shall be welcoming Mr. Lu Tung, the Minister in charge of the Third Ministry of Machine Building, who is coming here with a large team of aviation experts. Other areas of interest cover power generation, mining equipment, steel and steel plants. Deals have recently been concluded with British firms for coalmining equipment, petrochemical plants, steelworks consultancy, steam generators and plant for various other forms of manufacture.

In this connection, may I refer to the remark of the noble Baroness, Lady Vickers, that perhaps there may have been some comments about the reception accorded to our distinguished visitors from China. I have looked into this and really I do not think that this country has any reason to chide itself on the level and nature of the reception given to our friends from China. I have details here: Mr. Wang had discussions with our Prime Minister and with my right honourable friends the Secretaries of State for Industry, Trade, Energy and Foreign and Commonwealth Affairs and with the Chancellor of the Exchequer. He practically became a member of the Cabinet! He was received by the Prime Minister at No. 10 and was also entertained to luncheon by His Royal Highness the Duke of Kent, in his capacity as vice-chairman of the British Overseas Trade Board. Mr. Wang was also entertained by my right honourable friends the Secretaries of State for Transport, and for Scotland, and by the Lord Privy Seal, as well as by Members of both Houses. The level of treatment, indeed, is fully in accordance with British protocol and, as one who has some experience in these matters, I would say it really compares favourably with that accorded by any comparable country to which the Chinese Government have sent their Ministers. We shall maintain, and endeavour to improve on, this record.

In the course of Vice-Premier Wang Chen's visit, both sides expressed their firm desire and intention to develop economic co-operation between China and the United Kingdom. In particular, agreement was reached in principle to negotiate a long-term economic cooperation agreement, under which our two countries will aim to achieve between now and 1985 a level of joint trade of the order of £4 to £5 billion—that is £4 to £5 thousand million—and indeed in practice this might be exceeded. That figure compares with the present level of Sino-British trade of under £200 million a year. Since August we have achieved contracts of about that magnitude, and indeed the signs are that we are already well in flow with new contracts to achieve much higher targets than we have had in past years. However, the long-term target of £4 to £5 billion by about 1985 remains. It is a big target and, as a number of noble Lords reminded us and particularly my noble friend Lord Davies, it does not all depend on Governments. It depends on performance on the shop floor by management and by men.

I have been looking at the arrangements relating to credit. They compare very favourably with those accorded by any comparable country. I have considered with my advisers what the position is in regard to governmental aid, advice and promotion, and we are in very good trim, for a Government—as would any Government of either side—would have the necessary instruments of promotion to its hand now. But I am very glad that this debate has emphasised that not all the powers of government, or even of institutions in the financial world, can achieve this target unless we find in production, in delivery and in all the essentials of industry a match for the enablements that successive Governments have been able to provide. My right honourable friend the Secretary of State for Industry hopes to carry forward this co-operation by visiting China himself early in the new year.

Our readiness to co-operate in China's technological development was reflected in the signing during Vice-Premier Wang's visit of a science and technology agreement on 15th November. This is a broad and flexible framework agreement, designed to encourage co-operation in various fields of science and technology, by means of exchanges of visits and of scientific information and other methods which are to be agreed on by the appropriate organisations, both governmental and non-governmental on each side.

On this point, perhaps I may refer to a question raised by the noble Lord, Lord O'Hagan, who led for the Opposition on this occasion. Both the EEC/China and the potential United Kingdom/China trade agreements are indeed framework agreements. It is up to individual firms or organisations—one refers to private and to nationalised organisations—to pursue the opportunities thus opened to them. The framework is there and it may well be very strong indeed. The opportunities are there, but I repeat that they must be grasped by those who carry out the work, or say that they can carry out the work, and they will receive every possible encouragement from Her Majesty's Government.

Noble Lords have mentioned the possibility of defence sales. These were also discussed with Vice-Premier Wang and his delegation, and their visit did indeed clarify and confirm Chinese interest in United Kingdom defence equipment, including Harrier aircraft. On our side, we made it clear that the British Government are willing to discuss the sale of defensive military equipment, subject to appropriate consultations with our allies. This is where COCOM comes in. It is an organisation not set up by this country only, but indeed by 15 countries, plus Japan and minus Iceland. It is essentially a NATO organisation, and its purpose is to exercise reasonable oversight of strategic exports and to keep lists of goods and equipment in reasonably up-to-date order, so that the primary purpose of NATO is not subverted by a mistake in the commercial field.

I have had reason to look into this to see how it is working, and I am glad to assure the House, and those who have raised this matter tonight, that it is working extremely well. These lists are not sacrosanct from year to year, or indeed from week to week. They are constantly being looked at and adjusted, so that necessary exclusions are taken out and additions, which are inevitable with the march of technology and science, are added. But the point was well raised and I can assure my noble friend Lord Davies, and the noble Earl, Lord De La Warr, that we shall, with our friends and allies, in the context of the purpose of NATO—that is, the defence of Western democracy—exercise this oversight responsibly, and with a view to giving the greatest possible margin of enterprise to the industries not only of our country but of the countries which are participative of the Paris arrangement. Noble Lords will recall that the Prime Minister has stated that Britain wishes to develop a broad and balanced political, as well as commercial, scientific and cultural relationship with China. This may well include some exports in the field of defence equipment, though we are not prepared to be only a supplier of defence equipment to China.

As part of the Chinese commitment to rapid modernisation, and as a condition of its success, the Chinese are reforming their education system, with the aim of encouraging high standards, and of creating an educated workforce and an echelon of fully trained scientists capable of taking China forward into the modern world. Again, China is prepared to look abroad for assistance with her educational programme, both in terms of sending Chinese students overseas and in inviting lecturers to China, and the United Kingdom is ready to make what contribution it can in both directions. It is gratifying to record that exchanges in the academic, scientific and educational fields are all developing rapidly.

I wish that I had time to give some very interesting facts and figures about the results of the agreement on an educational programme which stems from the visit of my right honourable friend Mrs. Shirley Williams, the Secretary of State for Education and Science. Very briefly, the Chinese authorities hope to send over 1,000 students to United Kingdom universities and polytechnics each year, though it will take time to build up to those numbers. In a reverse direction, we are discussing the sending of a large and increasing number of teachers of English to China; and in teaching English to the Chinese, I am quite sure that the Chinese will teach them the Chinese language.

On the point raised by the noble Earl, Lord Selkirk, and, I think, the noble Lord, Lord Geddes, about whether we are doing enough to increase the number of Chinese speakers in this country to serve not only the Foreign Office, trade and the Civil Service in an analogous department, but also industry and the professions, I believe that we are now alive to the need to do this, and part of the programme which is flowing from the very successful visit paid to China by the Secretary of State for Education and Science this year is to build up, both in China and in this country, mutual tuition of the two languages.

Lord O'HAGAN

My Lords, I hesitate to interrupt the noble Lord if he has reached his peroration, but has he finished his remarks on the Harriers?

Lord GORONWY-ROBERTS

My Lords, I had in my own estimation, but clearly the official spokesman for the Opposition would like a little more and, as always, I am prepared to oblige. As a result of Vice-Premier Wang's recent visit, the British Government are now in possession of more precise Chinese requirements for the Harrier aircraft. It has been the practice of this and previous Administrations not to discuss details of individual arms negotiations. Before a final decision is made, the views of Britain's allies must be obtained and consultations are now going on. I hope that that helps.

Lord GLADWYN

My Lords, will it take months, perhaps years, to consult our allies?

Lord GORONWY-ROBERTS

I am not disposed to argue on the basis of the time needed to negotiate, let alone decide. It takes two to negotiate, and it is not always one side that is a little tardy in providing the necessary data for decision. Suffice it to say that this is an immensely important matter, not only for this country but for our friends and allies as well. We have not, I think, been guilty of dragging our feet in the necessary discussions that must be the precursor of a decision in this field. The noble Lord did not interrupt me in my peroration; I wish I were that far on, for it might be a great relief to the House and, not least, to me if I were.

The noble Lord quite rightly placed great stress on the educational and technological exchange programme. An agreement of exchanges between the Royal Society and the Chinese Academy of Sciences has been signed. We hope to receive a greatly increased number of Chinese students in this country next year. Additionally—and I think that this is a point which the noble Lord had very much in mind—the cultural section of our Embassy in Peking is to be substantially strengthened by middle level appointments and also by secretarial additions.

In other spheres, too, I am glad to note the other exchanges—cultural, sporting and private—which have all contributed to the strengthening of our links with China. They are much too numerous to list in full on this occasion. My noble friend Lord Rhodes intervened to give a very good example of how exchanges in this field are proceeding. I shall certainly consider what the noble Lord, Lord Geddes, said about the need for further co-ordination. There is always need for co-ordination of activities of this kind when more than one Government Department, more than one quasi-governmental organisation like the British Council and more than one private or near-private organisation is involved. However, I was very pleased to hear the tribute paid to the Great Britain China Centre for the fine work that it has done.

Our relations with China over Hong Kong are excellent, and this is clearly shown by a number of recent developments: the introduction of new air and surface communication links, the increasing number of visits to China by people from Hong Kong, joint ventures between Chinese and Hong Kong enterprises and numerous instances of practical co-operation between the Hong Kong and Chinese authorities, most notably the recent agreement by China to provide increased water supplies to meet the anticipated demand in Hong Kong over the next decade or so.

We are mindful that China attaches importance to developing relations with Western Europe as a whole. It places particular value on the European Economic Community and concluded an important trade agreement with the Community earlier this year. In looking to Western Europe to meet many of its new needs, China, following its habitual pattern, will spread around its orders for contracts, and we shall undoubtedly find ourselves in competition with our European partners and, indeed, with Japan for trading orders. This is a challenge to which we are happy to rise.

I want to make one important point very clear. As the Government have repeatedly emphasised, the improvement in our relations with China is not directed at any third country. In particular, the Government want good and stable relations with the Soviet Union, relations within which we can pursue the vital interests we have in common in security matters such as disarmament negotiations, and also in trade. There is no influence without contact. We should expand trade with all countries, and perhaps especially with countries whose systems and philosophies may not be the same as ours. I do not believe that you can exercise democratic influence unless you are fully in contact at all levels, including that of trade.

In particular, the Government want the British-Chinese relationship so to develop that no other country feels that we are in any way eroding the relationship with that country. The normal development of Anglo-Chinese relations will not be allowed to impair constructive relations between the Soviet Union—and, indeed, any other country—and the United Kingdom. The Soviet Union, I repeat, will find us ready to pursue these relations at all times with energy, determination and good faith.

Lord GLADWYN

My Lords, do the Government really think that the sale of Harriers would seriously affect our relations with the Soviet Union?

Lord GORONWY-ROBERTS

My Lords, we are addressing ourselves to the question of Harriers and every other aspect of possible trade with China, regardless of what is said to us from outside. I was just coming to that point on which I have been pressed by more than one noble Lord, and I am very glad to say it. It goes without saying— but I am saying it—that we shall not allow any third country to tell us how we should manage our relations with China in any particular.

This has been a productive year for Sino-British contacts from all points of view. Many speakers have mentioned important points which I have not had time to mention. I shall refer to only one outstanding point which the noble Lord, Lord Polwarth, raised. It related to air services. Following the meeting in London between my right honourable friend and the Chinese Foreign Minister about a month age, we have been actively engaged in discussions with the Chinese side with a view to finalising and bringing into effect the air services agreement which was originally initialled in 1973. Discussions to reach the point of implementation are therefore, as a result of my right honourable friend's discussions, now in train, and I hope that without much more delay I may be able to respond from this Box as to the satisfactory conclusion of that very important agreement.

In conclusion, I can assure noble Lords that the Government will endeavour to build on the contacts I have mentioned— the agreements that are in formation—in order to develop relations with China in accordance with the needs and interests of our two countries. Despite the great differences in our histories, our traditions and our attitudes—and we must always take full account of these—there is ample scope for beneficial co-operation and growing understanding in all fields. We shall do our best to develop a dialogue with China, not only for mutual reward but in the larger interest of strengthening international peace and co-operation.

8.29 p.m.

Lord RHODES

My Lords, I do not intend to detain the House for more than a minute, but it just shows how recent news can rapidly become out of date, My report, speaking of China, says that Communism is essential, because only by tight control can an exodus from the countryside be prevented. This is an experience which has been the bugbear of many emerging countries since the war. In this connection, I must mention that a fairly disturbing feature is emerging, news of which has been handed to me today, as regards immigrants into Hong Kong. At the end of November the figure stood at 60,030 whereas for the whole of 1977 the figure was 21,000. The illegal immigrants into Hong Kong are now twenty times more numerous than they were two years ago.

This has been a fascinating and interesting debate. The education that I personally have had during these last four years on the European Committee has convinced me that there is a headlong rush all over the world to become industrialised and at some time or another there will be a really terrible stocktaking. Every single meeting that we have has to do with surplus production. When China is industrialising let her take notice of what the noble Lord, Lord Fulton, was telling us, because that philosophy ought to be considered. I thank everybody who has taken part in the debate and also all those who have listened so patiently to what we have said. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.