I took off the FD and it had a 1.5 mm shim around the whole seat tube. I cut the rear shim and fit a piece of it between the front half of the shim and the seat tube and filed off 1 mm of the rear of the FD clamp. It looks a bit of Cambodian engineering but it works. Here how it fits, front of FD clamp, full shim, part shim, down tube, rear of FD clamp that have had 1 mm filed off the back side. This gave me enough space to fit a 700x35 that just clears the rear of the FD clamp.
It looks like it is rubbing but it does not.
Now to find some interrupter brake levers to fit the handle bars.