CONFIDENTIAL
GUANGDONG NUCLEAR POWER PROJECT
ESSENTIAL FACTS
Background
1.
Project is to build nuclear power station in Guangdong province
of China to supply power to both Guangdong and Hong Kong. Project
was initiated and developed through discussions between the
Guangdong Power Company and China Light and Power Company Limited (CLP), Hong Kong's main electricity utility supplier of about
two-thirds of Hong Kong's power). Total project cost including financing would be £2.5-4 billion. GEC are seeking to supply conventional island and a French company, Framatome, the nuclear
island (each worth approx £500m.) Following recent talks in
Washington on non-proliferation issues, also possibility that
Americans may seek to supply equipment for project.
2. Memorandum of Understanding (MOU) signed by UK Department of
Industry and the Chinese Ministry of Water Resources and Electric
Power (MWREP) in March 1983. MOU outlines conditions for
establishment of joint venture, and terms on which Chinese would be
willing to purchase conventional island from GEC. Similar
agreement, relating to supply of nuclear island, signed in May by
Chinese and French Governments,
Political Implications
3. Project offers opportunity to strengthen political links between
China and Hong Kong; would give Chinese particular interest in
maintaining confidence in Hong Kong dollar, currency in which they
would repay foreign loans on project. These would stretch beyond 1997. Project appears to have high level support in Chinese
Government. Vice Premier Li Peng, formerly the Minister with responsibility for electric power, has continued to take a close interest in project, despite his promotion in June this year.
CONFIDENTIAL
No comments yet.
Private notes are available after approval.