TNAG-2981-FCO40-1473-Guangdong-nuclear-power-station-project-1982 — Page 76

Ehler (55

P.c

GR 350

CONFIDENTIAL

CONFIDENTIAL

Hiere 1661 1

FM BTC HONG KONG 200630Z OCT 82

TO ROUTINE DOI

Mr. Hoare 7421/10

Angleton's

We and keep a

careful eye

in this

> Plan 2stio

TELEGRAM NUMBER INDUS 175 OF 20 OCTO

AND TO ROUTINE PEKING

INFO SAVING PARIS, WASHINGTON

FOR MANZIE

GUANGDONG NUCLEAR PROJECT.

LORD KADOOR IE'S FERTILE MIND HAS AGAIN BEEN AT WORK ON THE

EQUITY PARTICIPATION QUESTION. HIS LATEST SOLUTION IS FOR

THE HONG KONG GOVERNMENT TO TAKE A 40 PERCENT INTEREST IN THE

JOINT VENTURE AND TO GUARANTEE REPAYMENT OF 40 PERCENT OF

THE LOANS FOR SO LONG AS HONG KONG REMAINS UNDER BRITISH

ADMINISTRATION.

2. LORD KADOORIE DISCUSSED THIS PROPOSAL WITH THE GOVERNOR ON

15 OCTOBER AND LEFT A PAPER WITH HIM (COPY BY BAG). ACCORDING

TO LORD KADOOR IE THE GOVERNOR UNDERSTANDABLY REAFFIRMED THE

HONG KONG GOVERNMENT'S DOCTRINAL RELUCTANCE TO TAKING EQUITY.

HE ALSO STRESSED THE NOVELTY AND RISK OF A VENTURE IN CHINA.

3. IN DISCUSSION WITH LORD KADOORIE BEFORE AND AFTER HIS MEETING

WITH THE GOVERNOR | REMINDED HIM OF THE BRITISH GOVERNMENT'S

STRONG VIEWS ON NOT THEMSELVES TAKING EQUITY. KADOORIE DID

NOT DISPUTE THIS AND HIS APPROACH TO THE GOVERNOR IS A REFLECTION

OF HIS TEMPORARY ACCEPATNCE OF IT. HOWEVER I SUSPECT THAT THIS

PRESENT MOVE IS BETTER INTERPRETED AS A STEP TOWARDS HIS

PREFERRED SOLUTION WHEREBY, DEPENDING ON THE EVENTUAL PACKAGE,

THE BRITISH, FRENCH AND HONG KONG GOVERNMENTS COULD TAKE THE

LION'S SHARE AND CLP ABOUT 4 PERCENT. HE ALSO STILL HOPES FOR A

ROLE FOR EXXON WHOM THE CHINESE HAVE APPARENTLY ASKED TO

CONTRIBUTE EQUITY.

4. I HOPE TO DISCUSS THE ABOVE WITH THE GOVERNOR SHORTLY.

CANNOT SEE THE HONG KONG GOVERNMENT CHANGING ITS NEGATIVE STANCE

BUT I UNDERSTAND THAT THE PROPOSAL IS BEING GIVEN SERIOUS

CONSIDERATION AND MAY BE PUT TO THE EXECUTIVE COUNCIL.

FCO PLEASE PASS SAVING ADDRESSEES.

ADAMS

LIMITED

RIPEATED AS REQUESTED

ADDITIONAL DISTN GUANGDONG NUCLEAR

THIS TELEGRAM

WAS NOT

ADVANCED

FED

NED

TRED

HK OG D MR.GIFFARD MR DONALD MRGILL MORE

CONFIDENTIAL