TNAG-1059-FCO40-1309-Guangdong-nuclear-power-station-project-1981 — Page 184

4.

Other recent reports from China indicate that considerable importance

is attached to the provision of a highly attractive financial package to

support any hardware offer. Treasury and ECGD have considerable reservations

and wish to avoid any commitment until the French terms have been revealed.

The French may continue to offer an all French package for Shanghai backed

by attractive finance leaving Guangdong and the UK as a reserve option.

5.

Sir Lawrence Kadoorie is submitting a report to the GPC/CCP

Executive Committee - which will remain in being stating amongst other

things:

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I have approached the British authorities with a view to ascertaining

their attitude and the degree of support we might expect from

the British Government.

As a personal interpretation of their views I believe that the

UK Government would support this project if: it were to secure

major hardware orders; the initial fuel charge would come from

the supplier of the nuclear island, but it might be to our

advantage to have two sources of supply for subsequent charges.

This is a matter for future consideration.

I believe, too, that support would take the form of an attractive

technical, financial and resource package put together and

presented by the UK Government. I believe that the UK would be

prepared to work with Framatome in whatever contractual relationship

might be preferred by the PRC and joint venture company, and that

UK interests would be prepared to inject equity. Alternatively,

if we so wish they would be prepared to work with Westinghouse.

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