999-64

30 July 1986

Dr D Wilson

Foreign & Commonwealth Office

Whitehall

London SW1

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DEPARTMENT OF TRADE AND INDUSTRY

1-19 VICTORIA STREET

LONDON SWIH OET

Telephone (Direct dialling) 01-215) 5462

GTN 215) (Switchboard) 01-215 7877

Dear David

GUANGDONG NUCLEAR PROJECT: SAFETY,

As you will know, I have invited you and David Morphet to a meeting this Friday to review where we stand on this complex problem. I thought it would be helpful to write in advance suggesting how we might tackle the current issues.

There seem to be to be two main issues, inevitably interlinked. These are:

(a) The pressures building up in Kong Kong and within the Hong Kong Government to take action with the Chinese, eg to defer the signing of contracts or underline the "political price" of continuing with the project.

(b) The strategy for reassuring Hong Kong that the station will in fact be constructed and operate safely.

I suggest we might begin by discussing the first topic, and in particular the pressure being exerted by the Hong Kong Government for us to encourage a deferral of contract signature. As Peking have noted, if we were to consider such an approach to the Chinese, we could hardly do so without consulting the French and GEC. We are endeavouring to clarify at present with GEC the precise consequences of possible delays to contract signature and authorisation to proceed. generally it would be helpful to confirm the FCO view on the wisdom of the course being advocated by the Governor for more explicit statements to the Chinese about the damaging consequences of proceeding with the station and discuss the need for a steer to be given to Hong Kong.

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On the second topic, we have of course made a start on the plan of action previously agreed with Hong Kong and the French

Other Government by opening discussions with the Chinese.

such as the UMELCO visits to other nuclear developments

We have to be power authorities are also taking place. capable to responding flexibly to a continually developing situation. However, we also have to keep in mind that a programme of "reassurance" will only be as good as the

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