TNAG-1058-FCO40-1308-Guangdong-nuclear-power-station-project-1981 — Page 16

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SUBJECT: LORD CARRINGTON'S VISIT TO CHINA : 1-5 APRIL

BRIEF NO

POINTS TO MAKE

: GUANGDONG NUCLEAR PROJECT

1. Reaffirm continuing British interest and commitment to project's satisfactory conclusion. HMG and HKG studying feasibility report. Understand report now approved by Guangdong and submitted to State Council.

2. Chinese views on project? Likely to be affected by current cutbacks in capital construction? Timing of decisions on eg reactor vendor? Note feasibility report's preference for Chinese and British equipment suppliers. The Hong Kong factor

3.

Project should be seen in terms of both Sino-British and China/Hong Kong cooperation. Revenue from Hong Kong as important to Guangdong for viability of project as supply of electricity would be to Hong Kong. British industry should therefore be granted major stake in project| that will contribute to Hong Kong's future power supply. GEC

-

4. Commend GEC's merits as suppliers of non-nuclear equipment. Outstanding international record as turbine

manufacturers eg recently beat Japanese competition for a Canadian contract; have been CLP's main turbine suppliers, including now for Castle Peak B [announcement likely on 26 March] Hope GEC presentation in Guangdong

5.

in February resolved any doubts about their capabilities.

HMG ready to approve GEC/Framatome joint proposal currently under discussion. If Chinese prefer different reactor supplier British firms could equally well cooperate with them.

CONFIDENTIAL

/Hong Kong