White House sees little risk in China nuclear deal
Tue Mar 15, 2005
By Adam Entous
WASHINGTON (Reuters) - The Bush administration sees little proliferation risk in helping Westinghouse Electric Co. build nuclear power plants in China for a state-run firm once accused of transferring sensitive technology to Iran and Pakistan, officials said on Tuesday.
But the White House has promised a thorough review before approval of up to $5 billion in Export-Import Bank direct loans and guarantees to help Westinghouse and other U.S. suppliers win the contracts to build four plants.
The Export-Import Bank approved a "preliminary commitment" last month.
Pennsylvania-based Westinghouse is owned by British Nuclear Fuels Ltd.
U.S. officials, speaking on condition of anonymity, said the Bush administration and the U.N.'s International Atomic Energy Agency have determined that the technology involved in the proposed plants for the state-run China National Nuclear Corp. would not represent a proliferation threat.
"These reactors are made for electricity purposes. They're not a very efficient way of generating weapons-grade material," said an official involved in the deliberations.
U.S. concerns about China National Nuclear Corp. date back to the mid-1990s, when the Clinton administration considered imposing penalties on China over $70,000 worth of specialized ring magnets that China National Nuclear Corp. sold in Pakistan. The magnets can be fitted in centrifuges that produce fissile materials for use in atomic bombs.
Sen. John Ashcroft, who later became President George W. Bush's attorney general, sharply criticized the Chinese company in 1997 for its alleged role in technology transfers, both to Pakistan and Iran.
Citing CIA reports about Chinese proliferation, Ashcroft bashed President Bill Clinton for authorizing sales of atomic reactors to China and Export-Import Bank loans after a pledge from Beijing that the technology would not end up in Iran or other nations.
Ashcroft, who resigned in November, was not immediately available to comment on whether he supported the Bush administration's position.
White House spokesman Scott McClellan said the $5 billion loan package from the Export-Import Bank "still has not been adopted," and that U.S. agencies would make sure that Chinese nuclear technology "proliferation is not going on."
Export-Import Bank spokesman Brett Decker called last month's decision by the bank's board of directors a "nonbinding expression of interest."
"A further detailed examination of the proposed transaction will take place," he said.
Another official said "the brakes could be put on it if necessary." The official said the Export-Import Bank, in considering the commercial viability of the project, will look at proliferation issues, if any arise.
Bush has made nuclear nonproliferation a top priority, and touts as a success the break-up of a nuclear components black market run by Abdul Qadeer Khan, the father of Pakistan's atomic bomb.
U.S. officials played down evidence of past links between the China National Nuclear Corp. and the Khan network.
But the Bush administration has stepped up pressure on China over dealings with Iran, and imposed economic penalties in January against several Chinese firms it accused of helping Tehran's pursuit of longer-range ballistic missiles.
Secretary of State Condoleezza Rice expressed concern on Tuesday about China's military build-up because of Beijing's rising tensions with Taiwan.
The State Department also renewed U.S. opposition to European Union plans to lift a 15-year-old ban on arms sales to China.
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