Daily Management Review

France and China to create a joint investment fund


France and China will create a fund for joint investments in foreign projects, said Minister of Foreign Affairs of France Jean-Marc Ayrault. This report emphasizes desire of China to invest in overseas projects in spite of some problems encountered in foreign markets.

Fredrik Rubensson
Fredrik Rubensson
Ayrault said at a joint briefing with Minister of Foreign Affairs of China Wang Yi in Beijing that one of the best examples of cooperation between the two countries is a project to build Hinkley Point C nuclear power plant in the UK. The official also added that the parties intend to work together to win in foreign tenders in third countries in various sectors of the economy.

"This is a model that we support around the world, including in Africa and Asia", - he said. The new joint fund will be established in the near future, said Ayrault without diving into details.

Construction Hinkley Point NPP has received a go-ahead after new British Prime Minister Theresa May earlier postponed the deal on national security grounds.

The NPP is a joint project of EDF Energy, British subsidiary of the French state-owned corporation EDF, and Chinese state-owned corporations China General Nuclear Corp. and China National Nuclear Corp.

The project cost is estimated at 18 billion pounds. As expected, Hinkley Point C will be the first nuclear power plant built in the UK for the past 20 years. By 2025, it will be able to generate up to 7% of the total electricity generated in the UK.

Start of construction of nuclear power plants has been scheduled for 2019, but the timing has repeatedly been shifted due to a number of factors (including checks from British regulators, uncertainty in nuclear power after Fukushima accident and a number of other reasons).

Many of the still existing nuclear power plants in the UK will soon have to be withdrawn from service. According to current forecasts, the UK will close yet four old NPPS before Hinkley Point C begins its work in the I quarter of 2023.

Chinese nuclear company China General Nuclear Power Corporation (CGN) will invest 6 billion pounds ($ 7.31 billion) in the project, total cost of which is estimated at 18 billion pounds.

Under the agreement, EDF will help CGN get a license to build its own nuclear reactor Hualong in the UK. The country’s nuclear regulatory regime is considered one of the toughest in the world.

China is seeking to establish itself as an exporter of services in the nuclear energy sector, so the nuclear power plant construction in the UK can open new markets for the PRC.

Previously, experts often emphasized that restrictions posed by China for foreign companies when operating in its territory far exceed those faced by Chinese companies.

However, Head of the Foreign Ministry of China said that the Chinese government openly welcomes investments from foreign companies. According to him, speed with which China opens its markets to foreign companies shows clearly enough that it takes less time than in some other developed countries.

source: reuters.com