CONFIDENTIAL
Covering SECRET
BACKGROUND AND ARGUMENT
The Case for Supply
1.
Benefits to British Industry.
The project would involve the construction of a 2 x 900 MW PWR nuclear power
station in Guangdong province adjacent to Hong Kong. It would provide much needed work for GEC for the conventional
island; NNC and Westinghouse for the nuclear island; and
valuable business for British Nuclear Fuels Ltd. One of the
Hong Kong utilities, China Light Power Co. Ltd., is expected to be closely involved in the management of the station. They would also buy power from the station, thereby generating the foreign exchange necessary for the repayment of
international loans.
Total hardware and fuel costs might
be in the region of $3 billion, of which the UK could gain
up to $2 billion, viz the whole of the conventional island,
up to 60% of the nuclear island, associated transmission
lines and some nuclear fuel.
2.
UK/PRC relations.
British involvement in this project
would thicken our relations with China considerably. Not only is the scale of the project large: implementation time
is long and the technology transfer significance enormous. A
major role for Britain would translate the level of our economic
development relationship to that of a major partner. More generally it would enhance the development of China's overall
alignment with the West.
3.
UK/Hong Kong relations.
Since the basis of the project is
a proposed joint venture between the China Light Power Co. Ltd.
Power of Hong Kong and the Guangdong Power Company, its successful undertaking would do much to strengthen economic links between
Hong Kong and Guangdong Province, which is currently energy
deficient. Such co-operation would also help to maintain
confidence in Hong Kong at a time when the territory's future is coming under close scrutiny.
CONFIDENTIAL Covering SECRET
14.