Pressing ahead, atomically
Lan Xinzhen

ABOUT 110 km north of Dalian, Liaoning Province, lies a village called Wentuozi. The several hundred households of this village east of the Bohai Sea have lived a tranquil life for many years, relying on agriculture and fishing for their livelihood. In 2005, the thunder of machines broke that tranquility after it was chosen as a site for a nuclear power plant. On August 18, 2007, the principal construction of the Hongyanhe Nuclear Power Plant was officially started near Wentuozi.
Information from the National Development and Reform Commission indicates that Hongyanhe Nuclear Power Plant will be the only plant in China starting four gigawatt (gw)-level generating units at once, after business operation begins in 2012.
More to come
At present, China has 11 nuclear power generating units in operation with a total installed capacity of 8.7 gw. Among the country’s total installed electrical capacity, nuclear power accounts for only 1.8 percent and contributed only 2.3 percent of the total power production. However, this situation is changing gradually. Since 2005, China has started construction of nuclear power plants each year. As a technologically mature, safe, economical and clean energy available for large-scale production, nuclear power is of great potential in China’s long-term development.
In 2005, China launched the Medium- and Long-Term Plan of Nuclear Power Development, speeding up mass construction of nuclear power plants and advancing the industrialization process.
“According to the plan, there will be installed capacity of 40 gw by 2020, accounting for 4 percent of the country’s total installed capacity and 6 percent of the total power production,” said Xia Guojun, former Secretary General of the Society for Nuclear Power Generation of the Chinese Society for Electrical Engineering. “Considering that there is a five-year construction period for nuclear power plants, in the following decade China must start construction of at least three gw-level nuclear power generating units every year.”
At present, the two companies with licenses for providing nuclear power, namely, China National Nuclear Corp. (CNNC) and China Guangdong Nuclear Power Group (CGNPC), have strengthened investment in their expansion. Moreover, four state-owned power generators, namely, China Huaneng Group, China Datang Corp., China Huadian Corp. and China Guodian Corp., are preparing to construct their own nuclear power plants. CNNC and CGNPC have introduced the third-generation technologies via international open tender and have invested in construction of nuclear power plants in Sanmen, Zhejiang Province, and Yangjiang, Guangdong Province, both of which are under construction. Among them, Guangdong Yangjiang Nuclear Power Plant will be the largest nuclear power plant in China, with an installed capacity of six gw-level generating units.
Besides Zhejiang and Guangdong, more than 10 provinces and municipalities have proposed plans for nuclear power development.
In order to satisfy the demand for nuclear power development, China is strengthening efforts to prospect for uranium resources, looking for large and super reserves of natural uranium resources. Geological surveys have been conducted over uranium resources in Ili Basin and Ordos Basin in north China and Xiangshan ore field in Jiangxi Province.
Development of nuclear power also brings huge business opportunities for nuclear power equipment manufacturing and other related industries. By 2020, total investment in nuclear power construction will reach 300 billion yuan, 150 billion yuan of which will be put into equipment manufacturing. If 60-70 percent of the equipment can be made by China, Chinese nuclear power equipment manufacturers will enjoy profits of over 100 billion yuan. As the field of nuclear power equipment investment is opened to non-state capital, much private and foreign capital has started to flow into China’s nuclear power construction.
Homegrown technologies
The Hongyanhe Nuclear Power Plant will adopt nuclear reactor technologies independently developed by China. This is second-generation nuclear power technology, more mature and safer than similar second-generation nuclear power technologies around the world. Of the four gw-level generating units of Hongyanhe Nuclear Power Plant, 70 percent of equipment of the No.1 and No.2 generating units and 80 percent of that of No.3 and No.4 generating units are made by China, while 85 percent of all the key equipment is locally made.
Besides the second generation of improved nuclear power technology, the third generation of application technology is now in use. However, the third generation technology is introduced from the United States. “Our goal now is to take our nuclear power technology from the third generation to the fourth generation as soon as possible,” said Xia. “Focusing on independent innovation of nuclear power technologies and equipment manufacturing is one of the targets for China to peacefully utilize nuclear energy.”
From the beginning of development of nuclear power, China has mainly relied on its own innovation. During the past few decades, China has made important achievements in nuclear power technologies, cycling technologies of nuclear fuels and basic nuclear research and so on, which have kept pace with or lead international nuclear technology field.
In terms of nuclear power plant construction, China has gained rich experience in engineering designing, construction and project management. It has the capability of independently designing 300-megawatt (mw) and 600-mw pressurized-water reactor (PWR) nuclear power plants. Particularly, the fuel elements can be manufactured by China and the performance has reached the international level. Comparatively complete security systems of nuclear safety, environmental protection and nuclear emergency measures have been developed.
CNNC is now the most important investor and the largest owner of all the nuclear power plants in operation on the Chinese mainland. It is an important force for the independent designing and developing of nuclear power, the only supplier of nuclear fuel, an important technology service provider for nuclear power operation and a professional supplier of nuclear instruments and apparatus, assuming important tasks in safeguarding nuclear power plant operation and safety technologies.
In 1991, led by CNNC, China independently designed and constructed its first nuclear power plant, a 300-mw PWR plant for the first stage of Qinshan Nuclear Power Plant. Operation of Qinshan Nuclear Power Plant began three years earlier than the Dayawan Nuclear Power Plant, which adopted technologies from France.
Mechanism must be transformed
Since the construction of the first nuclear power plant, Chinese nuclear power development has been slow.
According to him, nuclear has always been a top-secret material subject to uniform management of the state. Therefore the construction of nuclear power plants is totally under strict control of the state. Although non-state capital is now being encouraged to invest in nuclear power plants, they can only contribute investment but have no right to participate in construction and management.
“In our mind, we should look on nuclear power the same as hydropower, thermal power and other forms of electricity generated from renewable energies and incorporate nuclear power into the uniform power market, and should not treat it in isolation,” Xia continued.
In his opinion, argument on investment mechanism of China’s nuclear power construction has started in the 1970s and 1980s and continues till now. In the early days of China’s nuclear power development, the electricity department was responsible for construction and management of nuclear power and closely cooperated with the nuclear industry department in respect to nuclear fuel elements and reactor technologies.
At that time, the electricity department led China’s nuclear power development. At the end of the 1980s, the government assigned nuclear power to the nuclear industry department and adopted military management on companies for civil use of nuclear power. By now, only two nuclear companies are authorized to develop nuclear power. “This is incompatible with the market economy,” Xia said. “Such a mechanism of nuclear power construction and investment cannot suit the demands of large-scale nuclear power construction on any account and must be reformed as soon as possible.”
Xia also believes that transformation of nuclear power mechanisms means that investment needs to be made in nuclear power plants just like investments in hydropower and thermal power. The state should allow companies that are strong enough or willing to invest in nuclear power plants to establish nuclear power plants approved by the state in accordance with state planning, only if these nuclear power plants agree to accept supervision and check of the state and the International Atomic Energy Agency so as to ensure quality and operation safety of nuclear power plants.

(The Daily Mail-Beijing Review Articles Exchange Item)

UAE-Sino ties: Full of energy for synergy
Dr N Janardhan

THE meeting of the World Economic Forum on ‘New Champions’ of the global economy in September couldn’t have had a more apt host — China, which continues to amaze the world with its phenomenal economic growth.
Attending the inaugural annual meeting in Dalian, among others, was another country that fits the bill of a new champion — the UAE, which has witnessed meteoric growth in a short span, and recorded 9.4 per cent GDP growth in 2006, not too far behind China’s 10.7 per cent. The event, attended by Vice-President and Prime Minister of the UAE and Ruler of Dubai Sheikh Mohammed bin Rashid Al Maktoum , helped showcase the unique development model of the country and the investment opportunities to the world gathering. It also served as an opportunity for the UAE and China to intensify bilateral trade that has surpassed expectations in recent years and set ambitious targets for the years ahead.
A recent statement envisages a $100 billion business between the two countries by 2015 — a phenomenal increase during the next decade from the $14.2 billion bill in 2006, which itself is a six-fold jump since 2000. The UAE is China’s second largest trade partner among the Gulf Cooperation Council countries and the largest market for Chinese exports in the region. The fact that Chinese President Hu Jintao visited the UAE in January this year and UAE Minister of Economy Sheikha Lubna Al Qassimi visited China three months later bears testimony to the current level of bilateral engagement between the two countries.
The growing ties are anchored in complementarity of economic interests and driven by a rediscovery of ‘East-East’ relations. While China is looking to guarantee energy supplies for its robust economy and expand the market for its manufactured goods, the UAE is seeking investment opportunities abroad following high oil prices, as well as looking to attract Chinese investment, opportunities for both being plentiful in China. Tapping into China is important because it will account for 19 per cent of the world GDP by 2050, which is equal to that of the US, Europe and Japan combined.
China currently imports 32 per cent of its oil, which is likely to double by 2010. China’s gas consumption is rising at an even faster pace, with imports projected to increase from zero in 2000 to 20-25 million cubic meters by the end of the decade. To meet the demand, China has adopted a strategy of diversification by investing in oil/gas fields in more than 20 countries around the world. Interestingly, UAE-China trade ties are limited only to the non-oil sector, which is both good and bad. On a positive note, it indicates the strides made by the UAE in diversifying its economy away from oil. On the flip side, however, excluding the energy sector has dented the volume of bilateral trade. Realising this, the UAE and China entered into an agreement in 2005 aimed at bolstering bilateral relations in the energy and oil sector. Chinese companies could acquire a fair share in the mega oil and energy projects in the UAE. In April 2007, the UAE and China signed an MoU to set up a joint team tasked with boosting bilateral relations. The two countries have also reviewed ways of developing joint industrial cooperation with emphasis on renewable energy sources.
Several non-oil sector partnerships in the recent past also reflect the growing synergy between the two countries. Real estate giant Damac entered the Chinese market with a $2.7 billion mix-use development in Tanggu district; Jumeirah Group secured management rights for hotel development of the HanTang Jumeirah Shanghai, which is expected to open next year; and Emaar Properties opened an office in Shanghai with a plan to roll out a number of real estate projects. Emaar Industries and Investments — a private equity firm 40 per cent owned by Emaar Properties —- intends to set up an automobile-related plant in China with an investment of $200 million. On the other hand, Zhongon Construction Group is keen on investing about $100 million in real estate projects in Dubai, in partnership with Fkamber Holdings; and Dubai’s retail sector is likely to receive more than $200 million in investments from Dalian-based retail giant Dashang. Abu Dhabi-based petrochemicals maker Borouge has just announced that it will build its first overseas plant in China to take advantage of high demand for plastics in the automobile industry. The polypropylene facility is set start production with an initial capacity of 50,000 tonnes. Abu Dhabi National Oil Company and Vienna-based petrochemical company Borealis have a 60:40 share in Borouge, and already have a marketing office in Shanghai.
Dubai Ports World (DPW) and Tianjin Port Group Company Limited announced in June 2006 that they will build a container terminal in Tianjin at a cost of $500 million. The UAE company already operates container berths at six ports in China. Since China is becoming the “factory of the world” and many foreign companies are moving their production there, DPW is positioning in China is strategic.

—Khaleej Times



China, India understand possibilities in Africa
Jonathan Power

THE planned purchase of a 20 percent stake in South Africa’s highly successful Standard Bank by the Industrial and Commercial Bank of China, the world’s largest bank by market capitalization, is the biggest foreign direct investment in South Africa since the demise of apartheid. This signifies a degree of engagement by China that is way beyond the “resources grab” that many have accused China of in its recent dealings with Africa. This, as the Financial Times reported, “is evidence that China is looking for a deeper relationship”. For the ICBC this is an important step in its quest to become a global bank. Its chairman, Jiang Jianqing, says, “We are focusing on merger and acquisition in emerging markets in Asia and Africa because these places enjoy high growth rates and have great potential.” Last week, the China Development Bank ratcheted the tone up further by announcing a partnership with United Bank for Africa, one of Nigeria’s biggest lenders.
As Chinese — and Indian — investors almost pour into Africa one wonders if their European and North American competitors have woken up to the fact that Rip Van Winkle is waking up in Africa? The fact that a top Chinese banker brackets Africa with Asia is one more sign that the Asians themselves see what is happening in Africa, a repeat of what happened to them 20 and 30 years ago. They can see the potential while Western commentators, their spurious words tasting of sour grapes, point an accusing finger at China in particular, accusing it of planning to rape Africa as the Europeans did a 100 years ago. This is not rape, by any stretch of the imagination. This is business opportunities. Africa in many countries is on the way to booming and Africa is looking for marriages of convenience with willing investors in railroads, toll roads, ports, motorbike and cement factories. Already there are over 900 Chinese companies working in Africa.
The International Monetary Fund in its new “Regional Economic Outlook” estimates that next year the growth rate in sub-Saharan Africa should reach almost 7 percent. This is an average figure, pulled down by including the likes of the Congo, Somalia, Zimbabwe, Ethiopia, Eritrea and the Sudan. But most of black Africa is on a sustained upswing, helped by high commodity prices (which the IMF says has not been a critical factor) and successful debt relief. It is happening, despite stagnant aid, because of increased private capital inflows and rising domestic investment and productivity. The significant decline in deadly armed conflicts has also helped. The ex— war-riven states, Liberia, Sierra Leone and the Congo are growing at 5 percent.
Much of future growth will depend on an increase in the rate of private capital investment. This has tripled since 2003, although it is still far behind Asia’s. At the moment Nigeria and South Africa attract two thirds of it but in a number of other countries such as Ghana, Kenya, Cameroon, Uganda and Zambia, foreign investment in the bond and equity markets is on the rise. The upward pressure on oil prices has not yet hurt Africa. African countries have built up healthy reserves and have been able to draw these down to keep growth on track. However, if oil prices continue to rise the strain will become more apparent, although most countries carry reserves large enough to meet significant terms of trade shocks. Despite the high oil prices inflation continues to fall — down to an annual average of 7 percent and food supplies are improving despite the higher cost of oil-derived fertilizer.

—Arab News