The UK government is reportedly closing in on a deal that could kick China’s nuclear power giant General Nuclear Power Group (CGN) out of the ￡20 billion ($27 billion) Sizewell C nuclear power project on so-called security grounds. London may announce a decision ahead of next month’s spending review and the UN climate change conference in Glasgow in November, but it remains unclear how the Chinese company will be frozen out of Sizewell C, according to UK media outlet Daily Mail. Whether related reports are complete and accurately reflect the position of the UK government is not known yet. There was similar speculation by the UK media in July, but, if the alleged decision is confirmed by Johnson’s government, it will have adverse impact on the UK. For starters, it will leave the UK a huge financial gap which has to be plugged by pension funds. CGN has a 20 percent stake in the Sizewell C project and an option to retain that share of the nuclear project once it is built. If CGN is forced to pull out from the project, the UK side needs to figure out options to fill up the multi-billion pound funding hole. The Daily Mail reported that the Treasury Department is examining plans to use pension funds to plug the gap for Sizewell C. Second, it risks further ratcheting up geopolitical tensions, which are already running high after London’s decision to join the AUKUS pact with the US and Australia. The UK side has severely damaged relations with China with unilateral moves targeting China’s Xinjiang and Hong Kong. If it follows the US’ lead further politicizing economic and trade ties with China after its arbitrary Huawei ban, the blow to the confidence needed to foster two-way cooperation will be far worse than the economic loss caused by the breach of the contract of Sizewell C.
Global Times 26th Sept 2021 read more »