Canberra, 21 October 1971

Secret Austeo

China Policy: The Next Step

Purpose of Submission

As has been made clear in public statements, Government policy has been based in recent months on settling the question of Chinese representation in the United Nations before we look further at our bilateral relations with the People's Republic of China. This submission briefly records the developments in policy over the past 12 months, looks at the situations which could exist after the UN General Assembly vote on Chinese representation, and assesses courses of action which might be adopted.

2. Since the Government will be expected to make a statement on future China policy soon after the UN vote is taken, it should have in mind courses of action to keep abreast of likely developments in the policies of other friendly countries towards China. Attached to the submission are background papers:

(a) detailing the policies of other countries;¹ and

(b) examining Australian interests, terms and objectives in any act of recognition of the People's Republic of China.²

Policy Decisions this Year

3. A number of decisions regarding China policy have been made this year:

– On 23 February, Cabinet decided that we should concert with the United States, Japan and New Zealand on the question of Chinese representation in the United Nations.

– On 22 April, Cabinet decided that other countries could be consulted in this process, that Australia should avoid a vanguard role in it, and that we should seek in these activities and in other respects to minimize the damage to our chances of establishing a dialogue with the PRC.

– On 20 April and 4 May, Cabinet reviewed trade with China and decided that the application of more restrictive strategic export controls to China (the 'China differential') should cease, and strategic controls on trade with China should be similar to those applying to the USSR.

– On 11 May, and more extensively on 13 May, the Prime Minister made public statements outlining our policy, indicating that our objective was to establish normal relations with the People's Republic of China, and that to that end we wished to establish a dialogue.

– In September, it was agreed to co–sponsor the United States resolutions on Chinese representation in the United Nations.

Dialogue with Peking

4. On 27 May and on 2 July, the Australian Ambassador in Paris called on the Ambassador of the People's Republic of China and indicated that the Government wished to establish a dialogue with China, to work towards the normalization of relations through the establishment of commercial, cultural and other ties. The PRC Ambassador criticized Australia for 'following' the United States, for participating in the 'aggressive war' in VietNam, and for its 'hostility' towards China. These criticisms were rebutted, and were not thereafter pursued by the Chinese. The talks became stalemated, however, on two main issues:

(a) Australia's support for 'two Chinas' in the United Nations; and

(b) Australia's relations with the Republic of China on Taiwan.

On these issues neither we nor the Chinese indicated willingness to give ground. The Chinese side was prepared to discuss recognition only on the basis of our abandoning (a) and (b) above.

5. Conversations between the Australian Ambassador and the Chinese Ambassador in Belgrade later in July suggested some flexibility on the Chinese side, but when we sought to take up the dialogue there we were told that the place to talk was Paris. There has been only one other meeting in Paris, and that of a different nature. When the Ambassador accepted an invitation to the People's Republic's national day reception on 30 September, he was warmly received by the Chinese Ambassador and introduced to the Chinese Minister for Foreign Trade.

Chinese Representation in the UN: After the Vote

6. The UN General Assembly has before it three resolutions:

– the Albanian resolution which would seat the People's Republic in the Security Council and the General Assembly and expel the Republic of China;

– the 'non–expulsion resolution' which would make the expulsion of the ROC an important question requiring the support of a two–thirds majority of those present and voting;

– the 'dual representation resolution', which would seat Peking in the Security Council and the General Assembly, but also keep a seat in the General Assembly for the ROC.

It is not the purpose of this submission to canvas further questions relating to the vote on these reso1utions, other than to indicate the situations which could exist after the vote is taken. These are:

THE SUCCESS OF THE ALBANIAN RESOLUTION
This would lead to the ROC's departure from both the General Assembly and the Security Council. We are not sure whether the PRC would then take its seat at the current Assembly, but it would probably take its seat at an early meeting of the Security Council. A PRC mission to the UN would probably be set up in New York within a few months.

THE SUCCESS OF THE US RESOLUTION

The results of this are less clear. There are four basic alternatives:

(a) the ROC staying in, and the PRC staying out;

(b) the ROC walking out, and the PRC staying out;

(c) the ROC walking out, and the PRC joining;

(d) the ROC staying in, and the PRC joining.

These four alternative situations are listed in what seems the order of probability–(a) is most likely, (d) least likely. Both (c) and (d) would require a change in what appears at present to be an unalterable policy of the People's Republic of China. In situations (a) and (b) we would expect to see the Albanian resolution tabled again in 1972. In the intervening year we expect support for it would have further increased. Situation (c) would mean that the ROC would be free to take its seat again at a future time unless, in the interim, the Organization, with the PRC as a member, decided otherwise. Situations (c) and (d) should be apparent within a matter of weeks. In other words, if the PRC did not decide to take up its seat on this basis at this Assembly, it would not be likely to do so at the commencement of the 1972 General Assembly when, instead, the whole issue would be put to vote again.

7. If, therefore, the American resolutions are adopted, we can expect to see them take effect by early December or not at all. Our planning can keep this in mind.

Consequences for Bilateral Relations of Support for the American Resolutions

8. We have kept a close watch on commentaries from Peking on the American resolutions. There have been a number of these since early August, which have provided factual description of the three resolutions, expressed full support for the Albanian resolution, warmth towards all its co–sponsors and complete opposition to the US resolutions. Notably, however, only the Governments of the United States and Japan have been singled out for direct criticism as co–sponsors. Other co–sponsors, including Australia, go unnamed, being described simply as having been led astray by the United States or Japan. We do not therefore assess our support for these resolutions on this occasion as representing a major obstacle to future bilateral relations. This will be most clearly the case if the Albanian resolution succeeds, with or without Australian abstention. In that situation the question of Chinese representation will have been resolved and could no longer be an obstacle to better relations. If, however, the American resolutions succeed, Chinese representation may continue to be an obstacle to relations in situations (a) and (b) above. It would not in situations (c) and (d). Should situations (a) and (b) arise, it would be wise for us to make no decision or commitment and give no public indication of attitude to the question as it may arise at the 1972 Assembly until much closer to that time.

Other Governments' Bilateral Relations with Peking

9. We foresee a continuation in the trend towards the establishment of relations with Peking by other countries. This will be no less than at present if the American resolutions succeed, and will almost certainly accelerate if the Albanian resolution succeeds. Attachment A is a table giving our impressions of how countries that at present do not have diplomatic relations with Peking may move in coming months. Within this submission it is worthwhile to examine what will happen in Japan and the United States.

Japan

10. Prime Minister Sato seems very likely to step down from the leadership of the Liberal Democratic Party before the end of the year. If the American draft resolutions succeed, this may give him a little more time. However, feeling within the Liberal Democratic Party, as well as among all the opposition parties, in favour of early normalization of relations with China is strong and will very probably grow stronger, whatever the outcome of the voting in the General Assembly. Moreover, Japanese business interests, faced with something of a choice between dealing with Taiwan and the mainland, appear to be increasingly in favour of doing business with the mainland. Because of the close Government/business relationship in Japan, significant changes in the opinions of major business leaders are likely to have considerable impact within the LDP. Our assessment, therefore, is that Japanese policy on recognition will be obliged to change very soon. This will require Mr Sato's resignation and his replacement by a leader prepared to open serious negotiations with Peking. While no LDP leader is likely to want to sacrifice Taiwan completely, it seems possible that Japan might be prepared, as the price for recognition, to admit Peking's claim to sovereignty over Taiwan, secure in the belief that Taiwan's autonomy will not be immediately threatened and that Japan will be able to retain some, if not all, of its commercial ties.

11. It will not be essential for the sake of our bilateral relationship with Japan to keep closely in step with Japan's China policy, although a Japanese decision to open serious negations with Peking must have a substantial bearing on our own policy consideration. Relations between Japan and China are so complex and so involved with past hostility and current suspicion that Australia would be well advised to avoid any direct association with any Japanese move to seek diplomatic relations with Peking. An Australian decision to open serious negotiations with Peking, taken in advance of a similar Japanese decision, would be of interest to the Japanese Foreign Ministry but would not be of vital importance to the Japanese Government in its own consideration of the question. We should therefore keep the Japanese broadly informed of developments in our policy but without giving them any encouragement to expect us to consult them.

United States

12. The purpose of Dr Kissinger's second visit to Peking is to plan in more detail the programme and the agenda for President Nixon's visit. We still have no reliable information when the President's visit may take place. We do not rule out the possibility that the visit may come soon after the vote has been taken at the UN. We believe that, although it was agreed by Chou and Kissinger that the visit would take place before May 1972, it is likely to come before March, when the presidential primaries begin in the United States. It is possible that an announcement about the visit may come soon after Kissinger's return and after the UN vote. We can expect little forewarning.

13. We expect that the United States will use all available opportunities to secure advantage in its dealings with Peking. We may perhaps expect to be kept informed of the general course of those dealings from time to time, but not to be consulted or afforded opportunities to act ahead of, or at the same time as, the United States. It should also be borne in mind that the United States, as a superpower, will have special advantages in its dealings with Peking, and may expect to get special terms and concessions, which would not be available to Australia in its dealings with the Chinese. In all these circumstances, and, as in the case of Japan, since United States–Chinese relations are more complex and involve issues which are not directly our concern, we would be well advised to avoid complete association with United States policy towards China.

The Position of the Republic of China on Taiwan

14. It remains difficult to get any reliable information on the internal situation in Taiwan. There are, however, reports which it would be reasonable to accept, that the ROC Government is faced with some divergent pressures within its own ranks, within the Nationalist Party and throughout Taiwan. Those policy statements on Chinese representation which we have been told by the ROC are for internal consumption in Taiwan reflect a determination on the part of the Government to uphold its mandate as the government of China.

15. From early 1970 there were reports that Chiang Kai-shek, whose current term of office as President ends in 1972, would stand down in favour either of Vice–President and Premier Yen³ or of Chiang's son, Vice–Premier Chiang Ching-kuo. Reports since August have suggested, however, that Chiang Kai-shek is likely to stand again. Other reports have suggested that the 1972 elections (possibly in March) might provide for better representation of Taiwan in the National Assembly which at the moment amounts to about 2.5% of the total.

16. We expect that the ROC Government will use all its considerable power in Taiwan to ensure that its authority is not questioned in this period. It seems improbable that Peking would apply military pressure against Taiwan while the United States maintains its treaty commitment to the ROC. We do not believe the United States will drop that commitment without either a resolution of the Taiwan problem or an assurance of its stalemate.

17. We assess, therefore, that the position of the ROC is unlikely to change much soon, whatever the outcome at the UN. It is unlikely that the ROC will soon move from its claim to be the Government of China and accept a title simply as the Government of Taiwan. We believe that China shares the desire of the United States and Japan for peace in the area and that this is likely to provide an effective guarantee that Taiwan would not become an issue leading to a threat to regional security.

Australian Policy

18. The pattern of international developments clearly indicates that, whatever the result of voting at the UN may be, Australia's interests continue to lie in working towards the establishment of normal relations with Peking. If the Albanian resolution succeeds, the policy we have so far followed of seeking a place for both Chinas in multilateral and bilateral arrangements will no longer be viable. Only if the American resolutions succeeded, and resulted in situation (d) in paragraph 6, would we have some basis for continuing in our present policy on dual UN representation with a chance of success. If situations (a), (b) or (c) transpired, it would no doubt still be possible for us to maintain for a time our present policy of wishing to keep our relations with the ROC and establish relations with the PRC. We would do so, however, knowing that in cases (a) and (b) there would be further erosion of the position at the UN and that Peking's entry on its own terms would be assured in 1972; that any efforts we made to establish a political dialogue with Peking, while adhering to our present policy, would be rejected; and that in addition we could expect the frustration or bedevilment of significant bilateral arrangements we might seek in other areas, including trade.

Course of Action

19. Whatever steps we take should not be precipitate, and should, as far as possible be consistent with past policy. It would be best for our first step to be a tactical one, designed to seize the initiative in negotiation, leaving the next step to Peking, and leaving some time to elapse before any statement of substance on policy is required. The best way to do this would be for the Ambassador in Paris to inform the PRC Ambassador there that it was the desire of the Australian Government to proceed with consideration of the establishment of diplomatic relations with the People's Republic of China, and to ask the PRC Ambassador if he would seek from his Government precise and written formulation of its position, in the form of a draft joint communique which could be the basis of such further negotiation as may be required or desired. (Attachment B to this paper is a first look at what form this document might take, and what our interests in it are.)⁴

20. In terms of procedure, there is tactical advantage in this course; in terms of the drafting of the communique, there seems no tactical disadvantage and possible advantage. To leave the first draft to the Chinese side would ensure that this draft included any moderation which might develop in the Chinese position in the light of the UN vote, or for any other reason. We should regard the first draft as Peking's maximum claim, and negotiable to some extent. The vote on Chinese representation is likely to be taken, at the latest, by the end of October. It would seem desirable that we take this initiative very soon thereafter.

Public Comment

21. A statement will be expected from the Government as soon as the vote in the General Assembly is taken. Two draft contingency statements are in Attachment c.⁵ They will require review and possibly revision after the vote has been taken.

22. If it is agreed that the Ambassador in Paris should again approach the PRC Ambassador there, it would be appropriate for information about the contact, expressing some optimism, but avoiding comment on substance, to be given either in answer to a parliamentary question or by some other means. It would, however, be desirable to avoid any public mention of the meeting until it had taken place, and we knew that it had gone as we hoped.

Conclusions

23. It is recommended that:

(a) approval, in principle, be given to the course of action proposed in paragraph 19 above;

(b) the timing of this action be determined as soon as the UN vote on Chinese representation has been taken;

(c) the draft press statements in Attachment C be approved in principle subject to final approval of one or the other after the vote has been taken.

K.C.O. Shann

Acting Secretary

[NAA: A1838/38/18, xxii]

THE ADMISSION OF THE PEOPLE'S REPUBLIC OF CHINA TO THE UNITED NATIONS

When the UN General Assembly opened its debate on the Chinese representation question on 18 October, it had three resolutions before it: the US Important Question resolution declaring that any proposal to deprive the Republic of China [Taiwan] of its representation at the United Nations was an 'important question' requiring a two–thirds majority under the UN Charter; a second US Dual Representation resolution calling for the entry of the People's Republic of China to the United Nations, including a permanent seat on the Security Council but at the same time affirming 'the continued right of representation of the Republic of China'; and an Albanian resolution for the admission of the People's Republic of China to the United Nations and for the simultaneous expulsion of 'the representatives of Chiang Kai-shek'.

The debate was opened on 18 October when the Albanian Foreign Minister, Nesti Nase, introduced his country's resolution and strongly attacked those presented by the United States. The US delegate, George Bush, then made a strong appeal to the Assembly to admit the People's Republic of China to UN membership but not to expel the Republic of China. Among the principal speakers in the ensuing debate Sir Colin Crowe (United Kingdom) and Jacques Kosciusko–Morizet (France) opposed the US proposal for dual representation and stressed the necessity for the People's Republic of China to take its place at the UN, while Aichi Kiichi (Japan) and Sir Laurence Mcintyre (Australia) both opposed the expulsion of the Republic of China.

After the debate ended on 25 October the Assembly agreed by 61 votes (Australia) to 53 with 15 abstentions to give priority to the Important Question resolution (i.e. making the expulsion of the Republic of China subject to a two–thirds majority in the Assembly) which by the time had been co–sponsored by 22 countries headed by the United States. The Important Question resolution was then voted upon, but was rejected by 59 votes to 55 (Australia) with 15 abstentions and two countries absent. After the rejection of the Important Question resolution, the United States attempted to have the expulsion clause of the Albanian resolution (i.e. the clause calling for the expulsion of the ROC) divided from the admission clause (that calling for the admission of the PRC to the United Nations) and voted upon separately. This proposal, however; was defeated by 61 votes to 51 (Australia), with 16 abstentions. At this point the Foreign Minister of the Republic of China, Chow Shu-kai, took the floor to denounce the Albanian resolution as a 'flagrant violation of the Charter' and then walked out of the Assembly Hall followed by other members of the ROC delegation. The Assembly then voted on the Albanian resolution which was adopted by 76 votes to 35 (Australia) with 17 abstentions.

1 Not published.

2 The paper outlined issues that might arise in connection with the drafting of a joint communique with China. It identified four basic elements that had been contained in communiques signed with the PRC since October 1970, of which reference to Taiwan and China were the most problematic for Australia. Here, it was suggested that in 'the final analysis ... it is probable that the Chinese would insist on nothing less than the "Canadian" formula'.

3 Yen Chia-kan, Prime Minister and Vice President of the Republic of China.

4 It was judged that any communique put forward by the Chinese would be a variant of the formulae presented to other countries, 'varied in terms of the changes in the international situation (especially Chinese representation) and China's attitude towards Australia as a European country in the region, an ally of the United States with a close relationship with Japan'. The basic aspects of communiques signed since October 1970 were seen as including: (a) reference to the five principles of co–existence as a basis for diplomatic relations (b) reference to China and Taiwan (c) reference to the recognising government and its policies and aspirations and (d) reference to the establishment of diplomatic missions and their status.

5 The first draft statement, for use in the event of success of the US resolutions, noted that Australia was pleased with the result, and hoped that the PRC and ROC would accept it. As for bilateral relations with the former, the Australian Government reaffirmed its 'determination to work for the progressive normalization of relations between our two countries, to culminate in full diplomatic relations on mutually acceptable terms'. The second draft communique was prepared in case the Albanian resolution achieved the requisite majority. Leaving a blank space for the vote Australia had placed, it expressed pleasure at the seating of Peking but disappointment at the expulsion of Taiwan. It also observed that the decision did not change the de facto rule of either government or the fact that both claimed the territory of the other. Still, opportunity for a peaceful solution had to be retained and Australia was committed to encourage peace in the region. In this regard, Australia would continue to pursue dialogue with the PRC (seeking the same end as quoted above).