[
CORRDENTIAL
sales. One aspect for consideration is the need to collaborate probably with the French or Westinghouse, as the UK does not have a total PWR capability. The choice of partner will largely be one for the commercial interests (probably GEC) to decide. are however wider political and energy policy implications which
would need to be considered.
7.
À
conditions.
There
complication is the need to agree non-proliferation This will be primarily a matter for the PWR supplier, but we will be involved as probable fuel suppliers and because of our overall position in the project. The Chinese have made it clear that they will not accept international inspection, but we think it likely that they will give acceptable assurances that material and equipment will not be diverted to military use.
8. The Prime Minister will be aware that the New Territories
lease expires in 1997. It is too early to expect PRC to give any indication as to what their attitude would be towards a continued
British administration in Hong Kong. However, they have already given oral assurances to investors in Hong Kong that they wish
the economic status quo to be maintained. SLK believes that a
number of substantial projects, including a PWR, would enable the Chinese to point to the benefits of maintaining the status quo. firmly believes that the PRC, Hong Kong and UK form a tripod▾ where all parts are dependent on the other.
He
9. The development of projects which strengthen economic interdependence between Guangdong and Hong Kong should tend to contribute to mutual vested interest in Hong Kong's stability and thus should help to maintain business confidence in the territory. A major project such as a nuclear power station could well play an important role in reassuring investors about China's interest in maintaining Hong Hong's status, although it is unlikely that it will in itself provide a solution to the question of the future of Hong
CONFIDENTAL