RR HONG KONG
GRS 340
RESTRICTED
FM FCO 111754Z NOV 80
TO ROUTINE HONG KONG (FOR GOVERNOR) TELEGRAM NUMBER 1007 OF 11 NOVEMBER AND TO PEKING
FOLLOWING TELEGRAM NOW REPEATED TO YOU AT REQUEST OF HKGD WAS RECEIVED FROM D.0.1. TELEGRAM NO INDUS 317 OF 7/11
GUANGDONG NUCLEAR
SEE MIPT
DRAFT SPEAKING NOTE FOR SIR LAWRENCE KADDOOR IE/DR WALTER MARSHALL ON GUANGDONG NUCLEAR POWER STATION PROJECT
AS I OPEN SQUARE BRACKETS SIR LAWRENCE KADOOR IE CLOSE SQUARE BRACKETS AM AWARE FROM MY OPEN SQUARE BRACKETS HIS CLOSE SQUARE BRACKETS MEETINGS WITH UK GOVERNMENT MINISTERS, THE BRITISH GOVERN- MENT ATTACHES CONSIDERABLE IMPORTANCE TO THIS PROJECT. THE PRIME MINISTER HERSELF HAS NOTED THAT THE PROJECT COULD HAVE IMPORTANT BENEFITS FOR HONG KONG AND THE UK AS WELL AS FOR
THE PRC AND OFFERS AN OPPORTUNITY FOR BOTH THE UK AND THE PRC TO EXPRESS THEIR FAITH IN THE FUTURE OF HONG KONG.
IF YOU ASKED ME FOR A PERSONAL INTERPRETATION, I WOULD SAY THAT THE UK GOVERNMENT WOULD SUPPORT THIS PROJECT IF:
THE UK WERE TO HAVE OVERALL PROJECT LEADERSHIP:
IT WERE TO SECURE MAJOR HARDWARE ORDERS:
- IT WERE TO BE THE PREFERRED SOURCE FOR SUPPLYING FUEL
SERVICES:
- THE BANK OF CHINA WERE TO PROVIDE A 100 PERCENT GUARANTEE
FOR THE LOANS.
I BELIEVE THAT SUPPORT WOULD TAKE THE FORM OF AN ATTRACTIVE
TECHNICAL, FINANCIAL AND RESOURCE PACKAGE PUT TOGETHER AND
PRESENTED BY THE UK GOVERNMENT WITH THE STRONG INVOLVEMENT
BOTH OF HMG AND OF UK AUTHORITIES. I BELIEVE THAT THE UK
WOULD BE PREPARED TO WORK WITH EITHER FRAMATOME OR WESTINGHOUSE
IN WHATEVER CONTRACTUAL RELATIONSHIP MIGHT BE PREFERRED BY THE
PRC AND JOINT VENTURE COMPANY, AND THAT UK INTERESTS WOULD BE PREPARED TO INJECT EQUITY.
I ALSO BELIEVE THAT THE UK GOVERNMENT WOULD NOT EXPECT THE
APPLICATION OF IAEA SAFEGUARDS THOUGH I THINK THEY WOULD EXPECT TO RECEIVE ASSURANCE OF PHYSICAL PROTECTION, NO DIVERSION FROM PEACEFUL USES, AND NO RETRANSFER WITHOUT AGREEMENT. I UNDERSTAND THEIR POSTION TO BE NO MORE
RESTRICTING THAN THE POSITION OF OTHER SUPPLIER GOVERNMENTS.
I BELIEVE THAT THE UK GOVERNMENT WELL UNDERSTANDS THE
POLITICAL AND COMMERCIAL IMPLICATIONS OF THE PROJECT AND THAT A JOINT DEVELOPMENT COULD STRENGTHEN THE ECONOMIC INTER-
DEPENDENCE BETWEEN GUANGDONG AND HONG KONG AND THUS CONTRIBUTE
TO MUTUAL INTEREST IV HONG KONG STABILITY AND THE MAINTENANCE
OF BUSINESS CONFIDENCE IN THE TERRITORY. I AM THEREFORE
CERTAIN THAT THE UK GOVERNMENT WOULD BE PREPARED TO DISCUSS
URGENTLY THE NATURE OF A TOTAL UK PACKAGE, AND UK GOVERNMENT
OFFICIALS WOULD BE PREPARED TO VISIT GUANGDONG OR PEKING IN
ORDER TO DO THIS AT THE EARLIEST OPPORTUNITY.
CARRINGTON
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