Created: 7/26/1962

OCR scan of the original document, errors are possible





SUBJECT: Chinese Communist Foreign Policy

1. Foreign Minister Chen Yi told Malcolm MacDonald in Geneva last week that Communist China, because of ita domestic problems, wants peace and does not want to get involved in any war, big or small. Chan's statement reflects the sense of weakness in Pelping that has forced it to moderate ita approach to many foreign policy

Taiwan Strait

Faced with an unfavorable balance of military power in the Taiwan Strait and operating under theof the Soviet support commitment, Pelping has taken the long view on resolving the Taiwan issue. Chinese Communist leaders have statedumber of occasions that it might take many years to settle the question.

In tho past week, Peiping went still further to underscore its disinclination to take the military initiative against the Chinese Nationalists. Chen Yi told MacDonald that Peiping could easily attack Quemoy and Matsu but did not intend to do ao; the allusion

to the vulnerability of the offshore islands was in the naturearning to head off any probe of the regime's weaknesses. Peiping is determined toNationalist designs to exploit the economic

debacle and popular unrest on the mainland, and Peiping's commentary in the past month has scored Nationalist plans to take advantage of the "temporary difficulties" of the Communists. This anxiety about hostilities in theStrait, coupledetermination to put up asisplay of might as it can muster, will probably continue to underlie Peiping's actions in the area.

Sino-Soviet Relations

relations with Moscow alsosome degree the sobriety tbat has followed inof the regime's domestic setbacks. down recently by the foreign ministry inthat China will not "recklessly makethe Soviets while showing that its Ideologicalremains "firm and clear." In practice, thisa turn in Chinese behavior that is somewhatbut still unacceptable to Moscow. Thusarticles do not specifically discuss therapprochement but nevertheless continue toYugoslavia in strong terms. The Chinese tookstance at the recent World Peace Congress

in Moscow, but their defense of the Albanian leaders continues to be clear and unequivocal.

the moment, particularly asense of threat from other quarters,some appreciation of the Soviet protective Khrushchev's statement of support on theissue in earlythanlearly less than what Peiping desired,Chinese made the most they could of it inSino-Sovlet solidarity. Chen Yi at Genevathere were Sino-Soviet differences but went onthe West not to make too much of them becausewe shall defend ourselves together."


6. The armed clashes with Indian forcesoupled with the hard line taken in the Sino-Sovietprojected an image of Chinese bellicosity that Peiping Is currently trying to blur. The Chinese dilemma in this, as in other areas, is how to seem peaceful without seeming weak.

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far, the Chinese have managed to keepseats on the horns of the dilemma.avoid fresh clashes with the Indians but to holdterritory already occupied, Peiping has warnednot to Interpret Chinese "restraintign At the same time, the Chinese haveheightened Interest in getting negotiations on theisSue under way. In new discussions, Peipingagain intimate willingness to trade itsin northern Assam for New Delhi's recognitionholdings in Ladakh. Above all, the Chineseon their claims to territory guarding theirasset in the disputedconnecting Tibet with Sinkiang.

Trade with the West

economic difficulties and thewith Moscow have prodded Peiping tosupply sources outside the Communist of Japan, this has resultedradualof Sino-Japanese commerce andoft-pedalingdemands for political concessions. Peiping's purchase of British commercial aircraftgrowing interest in British technologicalear disappearance of anti-British themespropaganda. Visits by Chinese trade missionsand by Western commercial delegates to China haveduring the past year.

Underdeveloped Areas

economic crisis has had its impact onChina's program to win wider acceptance in AfricaAmerica. No new economic aid has been extendedin these areas for wellear and, withof Cuba, the implementation of existing aidhas been almost completely curtailed. retrenchment has cut deeply into China's gaudyexchange program. The number of delegations sentand Latia America, for instance, has Fewer cultural agreemeats are beingnew friendship associations are being formed, andexhibitions are sent abroad. In addition, theof foreign students has been set back, with manyAfrica and Latin America disgruntled and even unruly asof depressed living conditions in China and theof interest in their welfare. Upon returning tocountries, these students have contributed to thepicture of China as the model for underdeveloped peoples.

Upon returning to their native countries, these students have contributed to tbe dimming picture of China as the model for underdeveloped peoples.

"National Liberation" Movements

In his meeting with MacDonald, Chen YlChina's support for revolutionary movements. Pelping, he indicated, would help peoples seeking their Independence in "some small ways" but would encourage them to seek their aims by peaceful means. In the Chinese view, peaceful means must be combined with militant struggle. The Algerian settlement, for ex-ample, was hailed as proof of the value ofin negotiations on an equal footing and on the basis of armed struggle." The Laos agreement was reached only after "US-fostered forces suffered severe blows on the battlefield."

We thus envisage continued Chineseof the Viet Cong effort in South Vietnam andpressure on the USSR toore aggressive program whereever possible in supporting Insurgency abroad. Whatever the limitations Imposed on Peiping's foreign policy by the economic and morale crisis at homo, the Chinese feel that the West labors underdisadvantages in areas like South Vietnam. The policy in these areas is to make all the gains possible on the battlefield while colling for negotiations that will ratify those gains.

The United States

The US remains the "mainnd there is some indication of Chinese Coramuaist concern that the enemy is becoming an increasingly skilled opponent. This concern was evident earlyhen Peiping began broadcasting its preachment that Kennedyore tricky, more Machiavelian than Eisenhower, hence more vicious and more dangerous."

Over the past year, Peiping's respect for the American antagonist has apparently increased. eople's Daily analysis of President Kennedy's "grand strategy" last Sunday suggested that Chinese anxiety turns around several points. One is the effort cf the Administration to promote "corrosion" of the Communist bloc by relying in part on trends toward "peaceful transformation" of Communist countries away from older

revolutionary ideals. Another is the danger toliberation" movements posed by the vigor of the Administration's counter-insurgency program. Third is the effort of the Administration to resolvein the "imperialist camp" and makeore effective restraint on Communist ambitions.

14. While cocking its nervous eye on thesethe Chinese are at the same time inclined to explore attitudes in Washington for any prospective advantages that may accrue to China. Despite the animus in Peiping's propaganda, the Chinese ambassador tohas made several genial overtures to US diplomats. The reasons for the Chinese approaches are several, among them conceivably an interest in getting reassurances about US military intentions or in developingsources to Soviet economic aid. Peiping's room for maneuver in these approaches is circumscribed by its obsessive determination to negotiate from seeming strength rather than weakness. "We do not need to beaid- Chen Yi in his press conference at Geneva. He scoffed at the idea that Western aid to China could be offered without conditions, but he was equivocal when pressed on the subject of being helped by US surplus food. "Oure said, "would depend on the form of offer and circumstances."

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