UK’s surprise deferral on nuclear plant decision deals blow to China’s overseas ambitions

The surprise decision by the new British government to defer a final investment decision on a US$24 billion nuclear plant has casts a shadow over the globalisation strategy of China’s commercial nuclear industry.

The deal, if rejected by UK Prime Minister Theresa May and her cabinet who took office just over two weeks ago, could seriously threaten the industry’s chance to showcase a Chinese-designed and built nuclear power station in a developed nation for the first time.

“The immediate impact is not great because China is only one of the investors in the Hinkley Point C project and Chinese firms would only be among many sub-contractors for its construction,” said Xiamen University Centre for China Energy Economics Research director Lin Boqiang.

“But it would be a blow to the wider Chinese nuclear energy industry’s going-out strategy, especially in developed nations.”

Still, it would not affect the industry’s strategy to build projects elsewhere, since Chinese firms have the biggest projects in the pipeline and are the most experienced in building new reactors globally in the past two decades, he noted.

“Going out is a must for the industry, it is just a matter of pace and timing,” he said.