TNAG-2981-FCO40-1473-Guangdong-nuclear-power-station-project-1982 — Page 234

CONFIDENTIAL

ANNEX 3

ARGUMENTS FOR AND AGAINST AN ANGLO-FRENCH OR ANGLO-US PACKAGE

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FRAMATOME

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The arguments for a partnership with Framatome are:

(1) Through the initiative taken by President Giscard d'Estaing in

1980 the French established a strong position in Peking and the

recent statements to visiting British Ministers suggest that the

French remain the favoured nuclear partner;

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(2) CLP and Lord Kadoorie in particular

77.

favour a partnership wi

the French because they believe this has the best chance of success

(3) GEC consider the French are more likely to obtain the nuclear

island, for the reasons set out above;

(4) The French are likely to be able to offer more competitive

financial terms than the Americans.

weigh heavily with the Chinese;

It is clear that this would

(5) A good deal of preparatory work on thic option has been complcted:

an agreement between GEC and Framatome to work together on the

project has been drafted but not signed;

(6) Working with Framatome is likely to raise less problems on

apportioning liability for the plant's performance and safety;

Framatome are expected to be willing to accept liability for the

whole nuclear island. Westinghouse have said that they are willi

to accept a similar liability but it remains to be seen whether

CONFIDENTIAL