176. Telegram From the Department of State to the Liaison Office in China1

319559. Subject: Secretary’s December 18 Meeting With PRCLO Chief Chai.

Summary. PRCLO Chief Chai, in meeting with Secretary Vance early evening December 18, delivered oral démarche on PRC property in the US. He had given same message to Dr. Brzezinski earlier in day.2 He said that USG is obliged to protect property to ensure that PRC takes it over. The Secretary promised to consider matter with Legal Adviser. Meeting opened with warm mutual congratulations on normalization agreement. On other subjects, Chai renewed dinner invitation, and confirmed that Foreign Minister Huang had recovered health. Assistant Secretary Holbrooke reaffirmed Senator Nunn’s interest in visiting China and encouraged Chinese to be responsive to US press interest in visiting China. Chai and the Secretary also briefly discussed upcoming meeting with Gromyko; Secretary said completion of negotiations this year is possible. End summary.

1. Ambassador Chai Tse-min, accompanied by Counselor Tsao Kuei-sheng and interpreter Hsu Shang-wei, called on Secretary at Chinese request early evening December 18. Holbrooke, Sullivan and Thayer sat in.

2. As first meeting between the two since normalization, meeting received press photo coverage. While press still present, Chai apologized for not having called sooner after normalization announcement and expressed gratitude for Secretary’s contribution to normalization. Secretary reciprocated.

3. Following discussion of rapid movement in final stages of negotiations and favorable worldwide reaction, Chai said that American public opinion “by and large approved the announcement while only a few people oppose it.” The Secretary agreed, noting again the general worldwide approval. Chai stated that “only the Chiang clique is unhappy.” He added that USSR and Eastern European countries are attacking China, a further cause for Chinese happiness.

4. Chai raised Secretary’s forthcoming Geneva meeting with Gromyko. The Secretary said he would leave on Wednesday to have talks [Page 664] with Gromyko on Thursday and Friday, concluding them in time to be in Washington for Christmas. Chai asked if the Secretary expected to reach agreement with the Soviets this year. The Secretary said there was a chance of agreement being reached by then, noting that the issues had been narrowed. The question, he said, is whether or not those can be resolved, and this depends on whether or not the Soviets are at the point of accepting our position. If so, he said, the negotiations can be completed and “if not, we will just have to wait and see.” Chai commented that the Soviets will accept only if advantageous to them. The Secretary replied: “We shall look out for our own self interest.”

5. ROC Property. Chai said that now that bilateral relations were finally normalized he had wanted first of all to express thanks and congratulations to the Secretary. However, he said, he also wanted to talk about a situation pertinent to the period after normalization. He then made the following statement: As the Secretary can understand, all of the official property of the Chiang clique in the United States belongs to the PRC. Now the joint communiqué of establishment of diplomatic relations between the PRC and the US has been formally issued. According to international law, the US Government has the obligation to protect the above mentioned property in order to prevent the Chiang clique from transferring and embezzling this property and to let the Government of the PRC take it over in time (ji shi). (Ambassador Chai had made same démarche to Dr. Brzezinski earlier in the day.)

6. The Secretary answered that he would want to discuss with State Department lawyers promptly and would talk to Mr. Hansell next day. He asked Mr. Holbrooke and Mr. Sullivan to be on hand also as the Department looks into the property question.

7. Chai then reinvited Secretary to set date for dinner originally scheduled for December 12 but postponed because of the Middle East trip. The Secretary promised to suggest a new date after returning from Geneva.

8. In response to the Secretary’s question, Chai confirmed that Foreign Minister Huang had recovered his health. Chai commented that his physical condition was not as good as the Secretary’s. However, he said, he had noticed that Huang had been present at Chairman Hua’s press conference.3 The Secretary asked Chai to convey his best wishes and said he was pleased that Huang was back at work. The Secretary also said he looked forward very much to Vice Premier Teng’s visit.

9. As Chai indicated he was about to leave, the Secretary thanked him for calling, congratulated him on normalization and said that he had been happy to meet him at this important time.

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10. Mr. Holbrooke asked if he could raise an additional matter. He recalled that last week Senator Nunn had discussed with Chai Nunn’s interest in visiting China next month. Holbrooke said Nunn telephoned afternoon of December 18 to reiterate his desire to make the trip along with Senators Hart, Byrd, Tower and possibly Glenn. The Secretary agreed with Mr. Holbrooke it is important that, looking to the future, such real leaders make such a trip. Holbrooke said that the Senators’ objective is to discuss strategic matters in Peking. The reason Nunn had called that afternoon is that he is anxious to make final plans.

11. Press interest in China. Holbrooke mentioned also that many editors and publishers have approached us since the normalization announcement to express interest in visiting China. Holbrooke acknowledged that this is a question for disposal by the Chinese but it could be helpful to provide Americans with a greater understanding of China at a time when we will be making “those legislative judgments essential to normalization.” Chai replied that the Chinese would take this into consideration and would resolve these issues in due course. He said the Chinese also had received such applications. Before normalization, Chai added, many newspapers and press agencies wanted to send permanent correspondents to Peking. Now, however, the situation had been changed.

  1. Source: National Archives, RG 59, Central Foreign Policy File, P840148–2418. Confidential; Priority; Nodis. Drafted by Thayer and approved by Holbrooke. Repeated to Taipei, Hong Kong, and the White House.
  2. No record of a December 18 meeting between Chai and Brzezinski has been found.
  3. Hua held a press conference on December 16 in Beijing to announce the resumption of U.S.–PRC relations. (“China Reports Accord With U.S. to Establish Diplomatic Relations,” The New York Times, December 16, 1978, p. 10)