US-Chinese government officials sign nuclear-reactor deal

Dec 18, 2006, 7:12 GMT

Washington - China and the United States have signed a deal that would send four Westinghouse nuclear reactors to the Asian country, The New York Times reported Monday.

US Energy Secretary Samuel Bodman and Ma Kai, minister of China9s National Development and Reform Commission, signed a memorandum of understanding Saturday in Beijing for the world's largest nuclear-power contract, which was raising concerns in the United States over security and competitiveness.

The state-owned China National Nuclear Corp is to buy the reactors from US-based Westinghouse Electric, which was bought out two months ago by Japan's Toshiba Corp, in a deal analysts have valued at 5 billion to 8 billion dollars.

Westinghouse won the contract over French and Russian rivals after two years of negotiations and lobbying.

China has been buying a wide range of technology from overseas in the past year, including car design, engine manufacturing and aircraft assembly, but last year, an attempt by the state-owned China National Offshore Oil Corp to buy the US oil company Unocal fell apart amid objections from the US Congress. Congress also curtailed an attempt by Dubai's DP World to take over operations at US ports over security concerns.

Michael Wessel, a commissioner of the United States-China Economic and Security Review Commission, which reviews bilateral relations, expressed reservations about the nuclear deal to the Times, saying, 'It appears they are doing what other companies have done, which is to transfer the technology upfront.'

Such deals put the brakes on long-term competitive and technological benefits for the United States, while achieving advances for China, he said.

But the Times said objections to the nuclear deal could be limited because it was approved by a Republican cabinet official when Republican party members in Congress have been the most outspoken about technology transfers to China and because it came while Congress was recessed.

Stephen Tritch, Westinghouse's chief executive officer and president, admitted in a statement that the deal would allow China to build nuclear reactors with less overseas help down the road.