TNAG-0949-FCO40-1168-Effect-of-nuclear-exports-to-China-on-Hong-Kong-Guangdong-nu-1980 — Page 50

687

CONFIDENTTÄL

HEK166/1

TOP COPY

RECEIVED IN REGISTRY NO. 51 2 8 JUL 1980

DESK OFFICER

REGISTRY Action

GPS 400

CONFIDENTIAL

FM HONG KONG 2605032 JUL 80

TO IMMEDIATE FCO

TELEGRAM NUMBER 941 OF 26 JULY

INFO ROUTINE HONG KONG GOVT OFFICE LONDONEX

INFO IMMEDIATE PEKING

YOUR TEL NO 398 TO PEKING ( PARA 7):

NUCLEAR PROJECT.

OUR GENERAL VIEWS OF THE PROJECT ARE COVERED IN MY TELNOS 936. AND 855 (NOT TO PEKING) AS WELL AS THE GOVERNOR'S PERSONAL TELEGRAM TO THE PUS (HONG KONG TELNO 466, NOT TO PEKING). IN BRIEF, IT

IS TOO SOON TO HAVE A CLEAR PICTURE OF WHETHER THE NUCLEAR POWER

PROJECT WILL BE VIABLE BUT, IF IT IS, THERE ARE POTENTIALLY

SIGNIFICANT ADVANTAGES TO BE DERIVED FROM IT COMMERCIALLY AND

POLITICALLY.

2. ON EQUITY PARTICIPATION OUR VIEWS ARE AS IN PARA 2(1) OF MY TELNO

855 AND PARA 5 OF MY TELNO 936. DESPITE THE UNUSUAL NATURE OF SUCH AN ARRANGEMENT WE DO NOT RULE OUT THE POSSIBILITY OF A NOMINAL

STAKE IF THERE WERE STRONG ARGUMENTS IN FAVOUR OF SO DOING.

BUT THIS WOULD NEED TO BE THOUGHT THROUGH VERY CAREFULLY AND EXCO APPROVAL WOULD OF COURSE BE NEEDED. WE HAVE GIVEN NO HINT TO KADJORIE THAT WE MIGHT BE WILLING TO ENVISAGE THIS, NOR

DO WE WISH TO DO SO AT THIS STAGE.

3. AS SEEN FROM HERE, ANY APPROACH TO THE CHINESE TO CLARIFY

HMG'S UNCOMMITTED POSITION WOULD HAVE TO BE HANDLED WITH CARE

SO AS NOT TO BE INTERPRETED AS A DELIBERATE DOUCHE OF COLD WATER

WITH UNFORTUNATE POLITICAL AND COMMERCIAL CONSEQUENCES. A POSSIBLE

LINE WOULD BE TO SAY THAT YOU HAD BEEN INTERESTED TO HEAR THAT

TALKS APPEARED TO BE GOING WELL: YOU UNDERSTOOD THAT QUESTIONS HAD ARISEN ABOUT POSSIBLE INVESTMENT BY THE UK (AND HONG KONG

) GOVERNMENT: ANY SUCH DECISION BY THE UK GOVERNMENT WOULD OF

COURSE HAVE TO AWAIT THE FULL FEASIBILITY STUDY: YOU WERE HOPEFUL

THAT THE PROJECT WOULD PROVIDE OPPORTUNITIES FOR SUBSTANTIAL SALES

OF BRITISH EQUIPMENT: AND ANY FINANCIAL ARRANGEMENTS WOULD HAVE

TO BE MADE IN THE LIGHT OF THESE OPPORTUNITIES. THE EMBASSY

MIGHT PUT THIS IN THE CONTEXT OF GU MU MENTIONING THE FROJECT

TO THE FINANCIAL SECRETARY IN MAY AND YOUR HOPE, AND THAT OF THE HONG KONG GOVERNMENT, THAT IT WOULD BE SUCCESSFUL. 4. FCO PLEASE COPY TO DO, DOT AND D/EN.

CATER

FILES

HK & GD

FED

JNU

TRED

MR PH MOBERLY

MR DONALD

CONFIDENTIAL

ADDITIONAL DISTRIBUTION

GUANGDONG NUCLEAR

COPIES TO:

HONG KONG GOVT OFFICE, LONDON