TNAG-0950-FCO40-1169-Effect-of-nuclear-exports-to-China-on-Hong-Kong-Guangdong-nu-1980 — Page 55

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Mr McLaren FED K 256

НКК 16611

RECEIVED IN REC STRY NO. 51 30 OCT 1980

GUANDONG

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1. Morrice?? / Dr

1. My reason for suggesting that we discuss the project now is that, with the completion of the feasibility study, it will enter a new phase. From now on the UK corner is going to have to be fought hard and on a broader basis if we are to have any chance of significant success. How we are to do this will have to be thrashed out with all the other interests in the next few weeks. I think it is desirable to have a clear idea of how we in the FCO balance the divergent interests of China trade, Hong Kong interests, the future of the British nuclear industry and non-proliferation.

2.

(a)

(b)

Questions which it might be useful to review include:

Does the feasibility work suggest that a project of this nature is worth backing for Hong Kong?

What British commercial interests are we seeking to promote (fuel cycle services; turbo generators; transmission equip-

services)?

ment;

(c) What are the strengths and weaknesses of the competition?

(a) How are the Chinese likely to proceed when the feasibility

study is presented and what are likely to be the key factors, organisations and people (KEC Guandong Government and Peking) in their decisions?

(e)

(f)

(g)

(h)

(i)

To what extent are HMG's positions on issues such as equity or liability likely to be important in promoting the Hong Kong and British interests involved?

What are the non-proliferation issues which need to be faced if the UK is herself to supply nuclear material services or equipment?

What should be our tactics with the various. Chinese interests in the next few months (see (e) above) and how do these interact with the timetable for outstanding decisions here?

What particular considerations relating to Hong Kong (eg safety) have to be kept in mind?

What should HMG's view be of the project if no major British supply was involved?

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R J Alston

27 October 1980

CC:

Mr Clift, HK&GD

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Joint Nuclear Unit