TNAG-1242-FCO40-1555-Future-of-Hong-Kong-1983 — Page 147

SECRET

B

not therefore wish him to raise Hong Kong's future himself whilst in

China, (Lord Rhodes has now said that he will not do so) there are a

number of useful points which he could make to the Chinese if they press him to discuss the subject (Mr Luce has already given Lord D Rhodes a list of these). Moreover, as Lord Rhodes claims to be

visiting China primarily to discuss commercial questions, it would be very helpful if he could help to ascertain current Chinese thinking on the development of China's South West Energy Resources. There may be scope for British industry to participate in this.

CHINA: SOUTH WEST ENERGY RESOURCES

6. Guizhou and Yunnan provinces in South West China have massive

coal reserves but development of these has been hampered by lack of

money and by the region's remoteness and inadequate infrastructure.

In early 1982 a new corporation, The China Southwest Energy

Resources United Development Corporation (CSERUDC) comprising

representatives of the interested Ministries (coal, railways,

communications) and provinces (Guizhou, Yunnan, Guangdong, Guangxi)

as well as the Bank of China and Construction Bank, was set up with

a view to accelerating the development of these reserves. Plans

were drawn up to increase coal output from the existing 6 million

tonnes to 10mt by 1985 and 20-25mt by 2000, to improve the rail link

from the mines to ports in Guangdong Province and to improve the

port facilities; the installation near the mines of new coal-fired power stations was also envisaged (total new capacity of perhaps

1800 to 2400 MW between 1986 and 2000).

7. A CSERUDC delegation led by the Vice Minister of Coal (Kong Xun) visited Europe in the summer of 1982. The programme included visits to four countries (France, Germany, Belgium and Spain) whose

companies are members of a consortium put together by an Israeli

entrepreneur Mr Shaul Eisenberg, to pursue this project. The

delegation also visited Italy encouraged by Italian half-promises of soft finance. A visit to Britain was added to the programme as a

result of an initiative by the British Longwall Mining Association

(BLMA). During that visit GEC offered to undertake studies on

projects of mutual interest in connection with the development of

South West China energy resources eg power generating railway

SECRET