(UNTITLED)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP04T00447R000302160001-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: January 12, 2017
• Document Release Date: June 29, 2011
• Sequence Number: 1
• Publication Date: October 23, 1985
• Content Type: MEMO

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Central lntdlWnce Arncy
DIRECTORATE OF INTELLIGENCE
23 October 1985
China-Eastern Europe: Beijng Courts Moscow's Allies
Summary
China is expanding relations with Eastern Europe at a brisk pace in
an effort to encourage trends toward independence and increase trade and
economic cooperation. Under Moscow's suspicious gaze, the Chinese are
stepping up official exchanges and even attempting to restore party to
party ties, something they thus far refuse to do with the Soviets. The
Chinese claim they will gain economic benefits from increased trade with
the region, but we believe the prospects for such trade are limited. The
chances of significantly influencing the East Europeans to show greater
independence from Moscow are, if anything, even more remote, especially
now that a new and younger Soviet leadership has begun to assert itself.
This memorandum was prepared byl Office of East Asian Analysis.
Information available as of 23 October "o6 was used in its preparation. Comments and
queries are welcome and may be direcre,l to the Chief, Foreign Affairs, China Division,
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Beijing's Strategy
The opening to Eastern Europe -- initiated in 1981-82 -- is part of a wider
strategy to expand China's foreign ties, undo the excesses of the Cultural Revolution,
and reduce tensions with the Soviet bloc. China has sought to exploit Soviet
preoccupation in recent years with internal political succession and economic failures
and external problems such as Afghanistan to rebuild its ties with Soviet client states
strained when Beijing was pursuing a "united front" approach with the United States and
Japan in the 1970s and 1980s. Beijing's foreign policy theorists describe their new
orientation as multipolar, arguing that by promoting regional independence and
prosperity there will be less scope for superpower interference and thus less chance for
war.
Behind the new rhetoric, however, Beijing still seeks to limit Soviet influence as
its prime goal. Renewed US assertiveness against Soviet expansionism has permitted
the Chinese to use more subtle political and economic measures to try to accomplish
their objectives. In the case of East Europe, by reducing tensions with the USSR and
avoiding identification with the United States, the Chinese have gained greater access to
the Warsaw Pact capitals. Beijing presumably hopes that by increasing the number and
intensity of these contacts it can gradually begin to exercise some influence and give
the bloc countries a vested interest in good ties with China.
Beijing also looks to Eastern Europe as a potential market for Chinese goods and
source of needed equipment, especially for some of China's Soviet-built factories that
date from the 1950s. Trade with Eastern Europe, according to an article published in
China's economic press in August, is particularly attractive because it is conducted on a
barter basis, allowing China to husband its foreign exchange for critical purchases of
Western technology and equipment. In return the Chinese are receiving serviceable
machine tools and other goods. The Chinese also see predictability and stability as
advantages in East European markets, deriving in part from the existence of
complementary foreign trade bureaucracies.
Expanding Contacts
China's quarrel with the USSR in the early 1960s and the subsequent excesses of
the Cultural Revolution era (1966-76) froze Beijing's relations with all but one of Eastern
Europe's capitals. Until the 1970s, China s only ally in the region was Albania, and the
chief product of that relationship was flattery for Mao Zedong's ideological pretensions.
In the early 1970s, Beijing forged a close relationship with Romania based on their
common opposition to Soviet domination After Mao's death in 1976, the Chinese
dropped their objections to Titoism, again in the interest of reinforcing Yugoslav
independence from Soviet interference, and significantly improved relations.
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Beijing's relations with Moscow's close allies in the region continued to languish
until 1981, however, hostage to the state of Sino-Soviet relations. Annual trade
agreements proved economically marginal and politically insignificant. The East
Europeans parroted the Soviet line against China in the wake of Chairman Hua Guofeng's
outspokenly anti-Soviet visits to Romania and Yugoslavia in 1978, and after China's
invasion of Vietnam in 1979. In 1980, the Chinese seemed to endorse Solidarity's efforts
in Poland because of their anti-Soviet implications, but backed down when the
reverberations of Solidarity's challenge to a ruling party were felt at home among
China's own budding protest movements.
The Chinese began to increase their exchanges with the Soviet Union's allies
slowly at first, apparently without a fixed plan for expansion. The first noteworthy
delegations to the region were factfinding missions, sent to investigate experiments with
economic reform in Hungary and Czechoslovakia. These had grown naturally from
China's internal search for a model of socialist modernization and followed disappointing
efforts to learn from Yugoslav experiences.
China's incremental approach probably derived in part from a desire not to
damage the close relationships painstakingly built with Romania and Yugoslavia in the
1970s. The lack of a clear Soviet signal authorizing increased East European contacts
with the Chinese undoubtedly was an even more important impediment for all the
Eastern countries except East Germany. According to US Embassy Berlin reporting, the
Chinese there believe the East Germans received Soviet encouragement to initiate low
level contacts as early as 1980. We suspect the Soviets used the East Germans as a
probe for changes in Beijing's attitude toward Moscow before committing their own
prestige to such an effort.
The break in this pattern occurred in March 1982, when General Secretary
Brezhnev, attempting to exploit US-China strains over sales of arms to Taiwan, made a
speech in Tashkent calling for improving Sino-Soviet relations. The Chinese formally
responded months later, following an extended internal debate that ended at the Twelfth
Party Congress in September 1982. On the one hand, China agreed to reopen political
talks at the vice foreign minister level with the USSR that had been suspended after the
invasion of Afghanistan. On the other, Beijing used the party forum to articulate a policy
toward foreign communist parties that implied that the Chinese would attempt to take
advantage of differences between the USSR and its allies.
At the Congress, Hu Yaobang denounced "the practice of one party compelling
other parties to make their policies serve its own party and state policies, or even
resorting to armed intervention in other countries," a thinly veiled reference to the
Soviet invasions of Hungary and Czechosh vakia. Hu added that China intended to
establish contacts with more parties on the basis of "independence, complete equality,
mutual respect, and noninterference."
In fact, the Chinese had already begun modestly to take advantage of the new
access to the East Europeans that Brezhnev gave them. Beijing authorized the first
student exchanges with East Germany in July 1982. According to US Embassy reporting,
China appointed new ambassadors to Poland, East Germany, Czechoslovakia, Hungary,
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and Bulgaria in 1982-83 who were better qualified and more capable than their
predecessors -- a development in keeping with new Foreign Ministry personnel trends
but also an indication of the seriousness of Beijing's approach to the region.
Party Contacts Resume
The most sensitive barometer of the state of relations between communist
countries is their party-to-party dealings. The falling out between Moscow and Beijing
had complex origins, but the the two sides set forth their dispute most forcefully in
ideological terms and at party forums. As the Sino-Soviet rift widened, China and the
USSR's East European allies broke off their party relations in the mid 1960s. They
stopped exchanging party delegations and attending each other's congresses.
The reinvigoration of Beijing's policy in the region has now prompted increased
interest on both sides of the Sino-Soviet dividing line in improving party relations.
Because both Moscow and Beijing want party relations to be reestablished on their own
terms, however, the pace of resumed contacts is slow and deliberate.
By March 1983, the Chinese Communist Party grew more confident and gave its
members in East European missions additional latitude to use and publicize party titles
including calling the East European governments "socialist."
editors of Chinese party publications began to make quiet visits to Hungary at
that time. Early last year, according to Embassy Berlin reporting, Beijing
was ready to resume full party relations with at least the Germans for the first time
since the Sino-Soviet rift 20 years before.
China tried to exploit the USSR's extended leadership crisis to encourage greater
East European independence during 1983-84. Beijing stepped up the frequency and level
of delegations travelling to the East. General Secretary Hu Yaobang first travelled to
Yugoslavia and Romania in spring 1983, to reassure those countries of China's
continuing commitment to them and to d-~iiver -- on Moscow's doorstep -- Beijing's
strong message of independence at about the same time, senior officials responsible for
dealings with Eastern Europe and the USSR began making routine swings through the
region, with increasing media coverage by the Chinese and most of their counterparts.
Vice Foreign Minister Qian Qichen and his deputy for the USSR and Eastern Europe, Ma
Xusheng, visited the region on separate itineraries in May and June.
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In 1984, Chen Muhua, Alternate Politburo Member and then Minister of Foreign
Economic Relations and Trade, travelled to Poland, Hungary, and Czechoslovakia. In
Hungary, according to Embassy reporting, she raised political issues during talks that her
hosts felt were inappropriate or might offend the USSR. One Hungarian official
speculated that Chen's purpose was to "drive a wedge between Hungary and the Soviet
Union." The official continued that the USSR "has expressed approval of our efforts to
increase trade relations with China if this will improve our ailing economy, but
discussing politics with us cannot help at all."
During the Chernenko interregnum especially, China intensified its efforts. The
Chinese-controlled press in Hong Kong gave particular emphasis to the visit of
Hungary's Deputy Premier Jozsef Marjai to Beijing in August 1984, noting that it
occurred not long after differences emerged between Moscow and Budapest over
relations with Bonn. Beijing's media also favorably replayed East European commentary
endorsing ast German General Secretary Honecker's attempt to visit West Germany.
The Soviet Union continues, however, to block its allies from resuming formal
party ties with China. The Chinese, according to Embassy Berlin reporting, suspect that
the Soviet ploy to use Germany to flirt with China went too far and the Soviets are now
holding the East Germans back.
One area where the Chinese have not endeavored to make inroads, we believe,
is military contacts with the Warsaw Pact forces. For some time, China has exchanged
military delegations with Romania, but we know of no such activity in the other East
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In order to make the most of its narrow access to East Europe, Beijing focuses
on developing trade and economic cooperation. In 1984, Chinese officials negotiated
economic cooperation agreements with each of the bloc partners. Although modest
when compared with the scale of activity envisioned under similar agreements with
Japan and the West, these undertakings will facilitate further exchanges of economic
delegations and in some cases assistance in updating China's old Soviet-style industrial
lants.
This year, the Chinese signed tong term trade agreements with each of the
countries. Fast rising Vice Premier Li Pend visited Poland, East Germany, and
Czechoslovakia in the course of negotiating or signing the pacts. He took advantage of
the precedent set at Chernenko's funeral by conveying party greetings from Hu Yaobang
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Despite the political points scored, however, the agreements often set targets for
annual trade volume well above what the respective officials believe is feasible. The
agreement with East Germany, for example, envisions increasing two-way trade 250
percent by 1990 over the 1984 total of $220 million. But Chinese officials in Berlin have
pointed to problems in East Germany's ability to deliver machinery and items such as
sheet steel that China wants. A chronic problem in trade with Romania, shortfalls are
becoming standard for China's trade with Eastern Europe in general. In 1983, trade
projections went up, but actual volume declined for half the countries and failed to
reach the targets in every case. The overall trade picture remained mixed in 1984, with
some modest increases in Chinese exports to the region. All East European trade
(excluding Romania, Albania, and Yugoslavia) totals less than China's trade with West
Germany alone: $846 million vs. $1.8 billion in 1984.
Beijing and its East European trading partners appear to have set high goals for
political as well as economic purposes, but in our view the potential for trade to be a
driving force for substantially improved relations is limited. Although Beijing's media
have discussed the potential for Eastern Europe to soak up products that China is
prevented from marketing in the West, the extended negotiations of this past spring and
summer, according to embassy reporting, demonstrated the basic difficulty of drawing
up lists of mutually acceptable goods. Part of the problem appears to be a result of
Chinese efforts to maneuver the East Europeans into competing with one another for
the China trade in goods they produce in common. Another East European concern is
that sales of their higher technologies are the only way to boost trade significantly over
the long term, but what Eastern Europe has to offer is not advanced enough to attract
the Chinese away from Western suppliers.
We expect the Chinese will continue their long-term, patient approach to Eastern
Europe, slowly rebuilding personal, institutional, and information links in the region.
Their annual agreements and increased personnel exchanges will present additional
opportunities to score political points.
We believe Beijing's primary goal will remain exploiting divisions between the
USSR and Eastern Europe. Premier Zhao Ziyang told West European leaders last summer
that China's policy is to encourage Eastern Europe to display "more independence of
thought." As fellow communists and former allies, however, they are undoubtedly
acutely aware of the severe limits on East European maneuverability and of the Soviet
capability to manipulate their allies. moreover, if
the Soviets suddenly lifted their constraints on the East Europeans, there would still be
practical limits on what China can achia,- as seen in the case of trade.
The Chinese task is made doubly t-tticult by Soviet attempts to channel
Sino-East European contacts onto a course leading primarily to improved Sino-Soviet
ties, especially to party relations. Whatever hopes Beijing may have had that it could
take advantage of Soviet preoccupation with its internal politics for another year or so
seem to be evaporating. Deng Xiaoping told foreign visitors earlier this year that
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Gorbachev will probably require two years to firm his grip on power. But an
authoritative Soviet commentary published in Pravda under the pseudonym 0.
Vladimirov last June lashed out against manifestations of nationalism within the Soviet
bloc and demanded greater unity. This has already caused some Chinese officials to
speculate that the new Soviet leader is moving swiftly to exert more control over East
European dealings with China.
Although we expect Beijing to continue trying to increase the levels of its
exchanges and to expand party contacts, we do not foresee the Chinese trying -- much
less succeeding -- in restoring full party relations with the parties in East Germany,
Poland, Czechoslovakia, Hungary, or Bulgaria without a major change in the Soviet
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SUBJECT: China-East Europe: Beijing Courts Moscow's Allies
1 - Dick Williams, Office of Chinese Affairs,
Bureau of East Asian and Pacific Affairs, Room 4318,
Department of State
1 - John J. Taylor, Director, Office of Analysis for East
Asia and the Pacific, Bureau of Intelligence and
Research, Room 8840, Department of State
1 - Mark Pratt, Director, EA/RA/Taiwan Coordination, Room
4312, Department of State
1 - David Laux, National Security Council, Room 302, OEOB
1 - JSI-3A, Room 2C238, Pentagon
1 - DIU tor East Asia, Room 2C238, Pentagon
1 - Byron Jac son, Office of Intelligence Liaison, Room
6854, Department of-Commerce
1 - James Lane, EUR/EE/German Democratic Republic, Room
4228, Department of State
1 - Terry R Snell, EUR/EE/Hungary, Room 5221,
Department of State
1 - John Caswell, EUR/EE/Bulgaria, Room 5219,
Department of State
1 - John Boris, EUR/EE/Czechoslovakia, Room 5217,
Department of State
1 - David Pozoraski, EUR/EE/Poland, Room 5223,
Department of State
1 - Thomas Lynch, EUR/EE/Romania, Room 5219,
Department of State
1 - Razvigor Bazala, EUR/EE/Yugoslavia, Room
5217, Department of State
1 - DDI (7E44)
1 - NIO/EA (7E62)
1 - Senior Review Panel (5G00)
1 - CEA(5D338)
1 - C/PES (7F24)
1 - PDB Staff (7F30)
1 - CPAS/ILS (7G50)
5 - CPAS/IMC/CB (7GO7)
1 - D/OEA (4F18)
1 - Research Director/OEA (4G32)
2 - C/OEA/China Division (4G32)
1 - C/OEA/CH/FOR (4G32)
1 - C/OEA/CH/DOM (4G32)
1 - C/OEA/CH/DEV (4G32)
1 - C/OEA/CH/DEF (4G32)
1 - C/SEA (4F38)
1 - C/NEA (4G43)
1 - EURA/EE (6G28)
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2 - OCR/C/RS (1H19)
1 - DDO/ EA
1 - OCR/CH H
1 - NIC/Analytical Group (7E47)
DDI/OEA/CH/FORD (18 October 1985)
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