At her first meeting with Mitterrand in 1981 they both spoke warm words about wanting a tunnel in principle; but it did not become a serious possibility until the economy improved. Then a number of her favourite businessmen began to show an interest. The National Westminster Bank took the lead in persuading the DTI that a tunnel could be financed without a Government guarantee. On this basis, Mrs Thatcher’s enthusiasm cautiously increased. Ideologically she was keen to give the private sector a chance to show what it could do, while she could see a political dividend from a big project which would create a lot of jobs.
Visiting Paris for a bilateral summit in December 1984, she and Mitterrand duly agreed to inject ‘a new urgency’ into studying the options. Both of them initially favoured a road, rather than a rail link: he wanted a bridge, she a drive-through tunnel. In practice, however, it became clear that a rail link was cheaper and more practical. Over the next year several bidders competed for the contract, but in the end it was the Channel Tunnel Group, headed by the former Ambassador to the US (and before that France), Nicholas Henderson, which gained the Prime Minister’s ear and won the prize.
The decision was announced by the two leaders at Lille in northern France in January 1986. Mrs Thatcher made a humorous speech recalling previous attempts to build a tunnel, going back to Napoleon, and claimed that Churchill had supported a Channel bridge on condition that the last span was a drawbridge which could be raised in case of French attack. Times had now changed, she suggested.13 As a rare gesture to Anglo-French fraternity she was persuaded to deliver the final part of her speech in French, which she learned phonetically with characteristic professionalism. This was the high point of Mrs Thatcher’s enthusiasm for Europe.
Opened in 1994, the Channel tunnel does indeed stand today as one of the few concrete legacies of Mrs Thatcher’s rule. For travellers to the Continent it is an established success. But as a demonstration of what private enterprise could do it was an ambiguous success. It was indeed financed (on the British side) by private capital, as Mrs Thatcher insisted it should be; but only at a loss to the shareholders who were persuaded to invest in it. It did not make money. Then private enterprise was not willing to fund the projected high-speed rail link from London to Folkestone, a necessary part of the service which fell years behind schedule and had, after all, to be paid for by the taxpayer. The lesson, as of so much of the privatisation experience, is that big infrastructural projects of this sort cannot be built without public money.
Pragmatism in Hong Kong
Outside the major theatres of Europe and the Cold War, Britain still faced a troublesome legacy of post-imperial problems in other far-flung corners of the world. During her first term Mrs Thatcher had been confronted with two such hangovers of empire, in Africa and the South Atlantic, both of which she handled successfully, though in opposite ways. Now in her second term she faced a more intractable problem than either: the approaching expiry of Britain’s hundred-year lease on Hong Kong, which was due to revert to China in 1997. Britain had immense commercial interests at stake as well as political responsibility for this anomalous enclave of Far Eastern capitalism, which was threatened with extinction in a decade’s time unless the Chinese Communists could be persuaded to permit its survival after the handover.
Once again all Mrs Thatcher’s instincts were aroused. First, Hong Kong was, like the Falklands, a British colony threatened with takeover by a neighbouring state. Although undeniably most of the territory was legally due to be returned to China, Hong Kong island itself was British sovereign territory which could in theory be retained, or at least used as a bargaining counter. Second, Hong Kong was a haven of freedom, prosperity and economic enterprise – though little democracy – besieged by Communism. Third, she did not like the Chinese. She accepted China as a fact of life and an ancient civilisation, culturally different and commanding respect on its own terms. But she had a ‘visceral dislike’ of the Chinese system and felt deeply that it should be possible to save Hong Kong from being swallowed by it. Coming straight after the Falklands, the problem of Hong Kong caused her ‘a lot of mental difficulty’.14
Yet the facts of the two situations were entirely different. On the one hand, China’s legal claim on 90 per cent of the territory was irrefutable – and Mrs Thatcher believed profoundly in the sanctity of law – while no one suggested that Hong Kong island was economically viable on its own. On the other, China possessed overwhelming military superiority, and anyway the island was indefensible: the Chinese could simply have cut off the water supply. Defiance was not an option.
So Britain had no choice but to negotiate – from a weak position – and try to secure the best possible result by diplomacy. Unwelcome as it was, Mrs Thatcher recognised the reality; but she still hoped, at the outset, to be able to bargain the sovereignty of Hong Kong island for continued British administration of the whole colony under nominal Chinese rule: in other words a form of the ‘leaseback’ idea originally proposed for the Falklands.
But when she met Deng Xiaoping in Beijing in September 1984 she found him unyielding. Believing that it was in China’s interest to preserve the prosperity of Hong Kong, she held out the possibility of ceding sovereignty in return for continued British administration. But Deng knew that he held all the cards and called her bluff. Like Mrs Thatcher herself in regard to the Falklands, he regarded sovereignty as non-negotiable. If Britain made difficulties, he warned, China would simply reoccupy Hong Kong before 1997.
In March 1983 she was persuaded to send a letter to the Chinese Prime Minister Zhao Ziyang indicating a more positive approach. Specifically, she undertook that she would not merely consider but ‘recommend’ ceding sovereignty in return for certain assurances about Hong Kong’s future. That cleared the way for Geoffrey Howe to open negotiations with Beijing on the basis of Deng’s characteristically paradoxical formula ‘one country, two systems’, which offered the possibility of preserving the essentials of Hong Kong’s capitalist way of life under Chinese rule. What this might mean in practice was impossible to know. The people of Hong Kong were suspicious that they were being sold down the river; but Howe still had no cards to play. In principle the Chinese recognised no distinction between sovereignty and administration, so he had nothing to bargain with. But he persisted, with quiet skill, and eventually secured an agreement in September 1984, guaranteeing Hong Kong’s ‘special status’ within China for fifty years after 1997, plus agreement on passports, air travel and land ownership. Mrs Thatcher was persuaded to accept it as the best deal that could be achieved. At the end of the year she flew to China again to sign the agreement and reassure the people of Hong Kong in person. It was a realistic settlement and the best she could do.
South Africa and the Commonwealth
Though greatly diminished in importance compared with the Atlantic alliance and the European Community, the Commonwealth was still another set of relationships which Mrs Thatcher had to maintain, and a biennial forum of international diplomacy which gave her considerable trouble. At the beginning of her first term she earned considerable credit by the unexpectedly pragmatic way she resolved the Rhodesian problem, and by her willingness to recognise the new Zimbabwe. But that success only brought into greater salience the affront to the conscience of a multiracial organisation represented by the persistence of white minority rule in South Africa. Before long Mrs Thatcher had dissipated most of the credit she had won in Rhodesia by her determined refusal to support economic sanctions against the regime in Pretoria. As a result she was soon even more embattled within the Commonwealth than she was in Europe, portrayed by much of the rest of the world as a friend and protector of apartheid – whereas she saw herself as its most practical opponent.
There is no clearer example of Mrs Thatcher’s refusal to acquiesce in a fashionable consensus than her stubborn resistance to sanctions against South Africa. She became the focus of all the frustration and hatred of the anti-apartheid movement not only in Britain but around the world. As with
her perverse support for nuclear weapons, progressive opinion could not understand how anyone could be against such an obviously virtuous cause. Once again her insensitivity to others’ passionately held beliefs, her certainty that she was right and her appearance of revelling in her isolation seemed wilfully provocative.Yet again there is a good case for maintaining that she was proved right by the eventual outcome, and her critics wrong.
Mrs Thatcher understood South Africa, like every other regional problem, as just another battleground in the global struggle between Western freedom and Soviet Communism. She regarded white South Africa, despite apartheid, as part of the West – Christian, capitalist, subject to the rule of law and in principle democratic – threatened by a Soviet-backed black liberation movement which aimed to destabilise the economy, destroy those liberal traditions and move South Africa into the Soviet camp. She opposed the principal black party, the African National Congress (ANC) – led by Oliver Tambo and a largely exiled leadership from outside South Africa while Nelson Mandela and other leaders served indefinite jail sentences – first as socialists, the tools of Communists if not actually Communists themselves; and second as terrorists, devoted to victory through ‘armed struggle’. Making no allowance for the fact that so long as they were denied the vote the ANC had no legal outlet for political struggle, she was adamant that a precondition of any settlement in South Africa must be the cessation of violence.
She was certainly influenced by the scale of British business interests in South Africa. The UK was the biggest outside investor in South Africa, which was Britain’s fourth-biggest trading partner. British industry – and particularly the defence industry – was heavily dependent on South African minerals. Sanctions, she constantly reminded the left, would damage not just British profits but British jobs. Moreover, around 800,000 white South Africans would be entitled to come to Britain if they were forced to flee South Africa, just as Portugal had been obliged to take an influx of ex-colonials from Angola and Mozambique. Other countries which jumped on the sanctions bandwagon did not have the same direct economic interest at stake.
Altogether she thought there was a lot of hypocrisy and easy moral outrage in the anti-apartheid movement. Her object – as she explained in an interview in the Sowetan in 1989 – was to end apartheid without destroying the South African economy in the process:
We do not want to see a future South African Government which really does represent the majority of South Africans inheriting a wasteland… In far too many countries in Africa ‘liberation’ has been followed by economic disaster and has brought few practical benefits to ordinary people. This can and must be avoided in South Africa.
The way to avoid this outcome was not less trade, but more. ‘What the country needs is opening up to the outside world. The last thing it needs is to close in on itself even more.’15 The policy of demonising South Africa as if it was uniquely wicked, she believed, was not only unfair, but positively counterproductive. ‘Insofar as sanctions did work,’ she declared on a visit to Norway in 1986,‘they would work by bringing about starvation and unemployment and greater misery amongst the immense black population…I find it morally repugnant to sit here or anywhere else and say that we decide that should be brought about.’16 Some of the most prominent South African opponents of apartheid agreed with her, which only strengthened Mrs Thatcher’s suspicion that the ANC demanded sanctions precisely because its aim was to destroy South Africa’s capitalist economy.
Convinced of the rightness of her analysis, Mrs Thatcher set herself to block the imposition of further Commonwealth and EC sanctions beyond those already in place, like the ban on sporting contacts, while working behind the scenes to try to influence the Pretoria Government from within. Casting herself as President Botha’s candid friend – ‘probably’, as she claimed in her memoirs, ‘the only helpful contact he had with western governments’17 – she invited him to Chequers in June 1984, provoking inevitable demonstrations, and treated him (in Bernard Ingham’s words) to some ‘very plain speaking’. She urged him to release Mandela, to stop harassing black dissidents, stop bombing ANC camps in neighbouring states and grant Namibian independence. She kept up the pressure in a sustained correspondence over the next five years. But all this was in private: she refused publicly to join the clamour for the release of Mandela, so she earned no credit with the anti-apartheid movement. Botha was grateful for her friendship but ignored the candour. There was no significant movement in South Africa so long as he remained in power.
Mrs Thatcher’s attitude to South Africa was much more principled and honourable than her critics recognised. At the same time she was less constructive than she could have been because she badly misjudged the internal opposition to apartheid. First, by insisting on classing the ANC as Communist terrorists, she completely failed to appreciate that Mandela and the rest of the ANC leadership were as deeply rooted in Western democratic values, liberal humanism, the Bible and Shakespeare as she herself was. Mandela was brought up as a Methodist on the very same hymns and prayers and poems as she was – though after his enforced leisure on Robben Island he had a rather deeper knowledge of English literature and history.
Then she compounded her reluctance to recognise the ANC by seeking a more ‘moderate’ and pro-Western alternative which she could promote instead. She pinned extravagant hopes on the Inkatha party led by the Zulu chief Mangosuthu Buthelezi. The more the world’s attention focused on Mandela the more stubbornly she championed Buthelezi as ‘the representative of the largest group of black South Africans’18 and ‘the head of the biggest nation in southern Africa’.19 She praised him as a friend of free enterprise and ‘a stalwart opponent of violent uprising’ – unaware that Pretoria was secretly arming Inkatha to fight the ANC.20 In taking sides in this way Mrs Thatcher was playing with fire.
It was in 1985 that she first set herself in direct opposition to the conscience of the world. That summer, as violent uprisings in townships all over South Africa brought the country close to civil war, President Botha declared a state of emergency. Alarmed, American and Swiss banks called in their debts and refused to make further loans, causing a devastating run on the rand. Under pressure from American public opinion, Reagan felt reluctantly obliged to tighten US sanctions before Congress passed a tougher package; and France and other European countries began to press for concerted EC action. In September Mrs Thatcher successfully vetoed the proposed EC sanctions; so when the Commonwealth heads of government assembled at Nassau in the Bahamas in October it was already clear that she was going to be isolated.
The only way she managed to delay further sanctions was by proposing to send a group of ‘eminent persons’ (EPG) to South Africa to assess the situation on the ground. President Botha let the EPG into the country in the spring of 1986, and allowed them to meet ANC leaders, including Mandela. They were impressed by Mandela and were close to negotiating a formula for his release when Botha wrecked their efforts by bombing ANC bases in Zambia, Zimbabwe and Botswana. They immediately abandoned their mission and soon afterwards submitted a gloomy report concluding that there was ‘no genuine intention on the part of the South African government to dismantle apartheid’ and advocating strengthened sanctions.
Privately Mrs Thatcher warned Botha that by falling back on a policy of ‘total crackdown’ he was making it hard for her to hold the line against sanctions. Behind the scenes she was urging him to do all the things the opponents of apartheid around the world wanted him to do: release Mandela, unban the ANC and start negotiating before it was too late. Having committed herself so vehemently against sanctions, she needed him to show some willingness to embrace reform voluntarily; but this he was refusing to do.
Publicly Mrs Thatcher revelled in her isolation. She had one important ally in the White House. ‘As you,’ President Reagan wrote to her, ‘I remain opposed to punitive sanctions which will only polarise the situation there and do the most harm to blacks.’ But Reagan too found himself under pressure to give
ground:
You noted you may be forced to accept some modest steps within the European and Commonwealth contexts to signal your opposition to apartheid, and in all frankness we may be faced with the same situation if Congress, as expected, passes some sanctions Bill later this summer or fall.21
The Senate duly voted 84–16 to approve a comprehensive package of economic sanctions. The EC too went ahead with a further package, agreed in June. Mrs Thatcher now had no choice but to acquiesce. Yet at a special Commonwealth Conference held in London in August she was still defiant. For the first time in the history of the Commonwealth, the London conference overrode British dissent and agreed to implement measures.
In 1987 Mrs Thatcher took her most positive step with the appointment of a new ambassador to South Africa. Robin Renwick had taken a leading part in devising the Zimbabwe settlement, and subsequently wrote a book demonstrating that economic sanctions never worked. In July 1987 Mrs Thatcher sent him back to southern Africa to pursue what he called ‘unconventional diplomacy’ in Pretoria. Publicly he was still required to echo her exaggerated faith in Buthelezi. But at the same time he was implicitly authorised to build bridges to the ANC. Over the next three years, he wrote later, he received ‘no instructions but full backing from her’ for the important part he played in helping to negotiate the release of Mandela and eventually the peaceful transition to majority rule.22
The critical opening came in 1989 when President Botha suffered a stroke and was forced – unwillingly – to step down. His successor, F. W. de Klerk, was not at first sight a great improvement. But Renwick had already identified him as a genuine reformer who had learned the lesson of Rhodesia and wanted to talk to the responsible black leaders before it was too late; Mrs Thatcher seized on him as a South African Gorbachev and was hopeful that there would now be some movement in Pretoria.
The Iron Lady Page 39
