TNAG-0938-FCO40-1157-Visit-of-John-Nott--Secretary-of-State-for-Trade--to-Hong-Ko-1980 — Page 78

CONFIDENTIAL

BRIEF FOR VISIT TO HONG KONG BY MINISTER FOR TRADE

30 AUGUST - 5 SEPTEMBER 1980

GUANGDONG NUCLEAR PROJECT

BACKGROUND

BRIEF 11

1

Following an agreement to install an electricity link between Kowloon and the Chinese Province of Guangdong the electicity utility (KEC) proposed a joint study with China Light and Power (CLP) (Hong Kong utility) into the feasibility of building a nuclear PWR power station in Guangdong (across the border with Hong Kong) to be financed through the sale of electricity to Hong Kong. CLP in turn, recognising its lack. of nuclear expertise, approached HMG for technical support in carrying out the study. Ministers endorsed UK industrial and official involvement including the offer of UK technical

support.

2 The joint KEC/CLP studies are progressing very satisfactorily, a favourable recommendation is anticipated before the end of

the year.

In parallel with the joint studies, an inter- departmental official committee has been formed to deal with the commercial and political aspects so as to further the possibility of UK hardware sales. The committee is preparing a paper for submission to Ministers on the whole project and its implications by mid-September. This should permit Ministers

time for the Foreign

to reach at least initial views in Secretary's visit to Hong Kong and China at the end of September.

3

Sir Lawrence Kadoorie, Chairman of CLP, discussed the

project with the Prime Minister in July. The Prime Minister said that the Chinese might well see the project as an earnest both of their own and of Britain's faith in the future of

Hong Kong.

4

The discussions between CLP and KEC are public knowledge. In answer to a question in Parliament on 2 June 1980, Mr Blaker said that no decisions have yet been made: that CLP is using

CONFIDENTIAL