CHINA PARTNERS WITH IAEA TO BUILD HUMAN RESOURCE CAPACITY IN THE NUCLEAR ENERGY SECTOR

UNCLAS UNVIE VIENNA 000119

SENSITIVE
SIPDIS

STATE FOR IO/T, ISN/MNSA, ISN/RA
NA-243-GOOREVICH/OEHLBERT, BRUNNS; NA-241 O'CONNOR, SIEMON;
NA21-CUMMINS, ILIOPULOS; NE- MCGINNIS, PEKO, CLAPPER
NRC FOR OIP - DUNN LEE, HENDERSON, SCHWARTZMAN

E.O. 12958: N/A
TAGS: ENRG PREL TRGY ETTC KNNPCH
SUBJECT: CHINA PARTNERS WITH IAEA TO BUILD HUMAN RESOURCE CAPACITY
IN THE NUCLEAR ENERGY SECTOR

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SUMMARY
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1. (U) China has embarked on a major IAEA Technical Cooperation (TC)
project focusing on Human Resource Capacity Building and Technical
and Vocational Education and Training (TVET) to rehabilitate of
eight national training centers. Each center will have a specialty
such as radiation safety, needs assessments, uranium enrichment,
waste management, and training of trainers. The aim of the IAEA TC
project is to reduce stress on the already overburdened nuclear
professionals in China and build national capacity in this area,
thereby decreasing dependence on foreign experts. Upon completion,
China also hopes to open its network of centers to other countries
in Asia. To fund this TC project, China will contribute a total of
USD 2 million through in-kind services and is seeking an additional
USD 2,059,100 million in extrabudgetary funding from IAEA member
states, in particular the Europeans. The PRC and IAEA hope that
this project will create a framework transferable to the other TC
Regions that would like to embark on similar projects. For the
U.S., it provides an unusual and welcome example of transparency in
the development f the IAEA's TC program.

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PROJECT SPECIFICS
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2. (U) PRC representatives in Vienna, on March 6, outlined for P5
and donor delegations medium and long-term plans for nuclear power
development. China hopes that no fewer than twelve new reactors
will be fully operational by 2020. R&D achievements noted by the
PRC include large scale thermal-hydraulic test loops, a heavy water
research reactor, a tandem accelerator and an experimental fast
reactor. While the PRC is focusing on energy self-reliance, China
seeks international cooperation in order to develop a network of
research centers through which countries in the region would gain
access to training and development. Total project funding is USD 4
million over three years with most of the PRC contribution in
construction, equipment and R&D and a requested USD $2,059,100 in
unconstrained funding from other member states.


3. (U) In rolling the project out, the PRC highlighted strong
involvement from the IAEA in assessment and design. The project
aims to address China's national weaknesses in the field: dwindling
personnel, and weak regulations, radiation safety, and
non-destructive testing capabilities. In the future, the PRC and
the IAEA would like to see this project as a model for regional
program design, and have been exceptionally transparent in
presenting the project to potential donors, the Europeans in
particular.


4. (SBU) In a private follow-up conversation, Chinese Mission DCM
Liu Yongde told us plainly that China was pursuing this project
through IAEA TC channels as an invitation to international
participation in the broader Chinese nuclear industry. Against the
backdrop of Chinese plans to invest over USD 100 Billion in nuclear
power over the coming 11-12 years, the USD 2 million in IAEA TC
contributions sought over three years were to be understood as
tokens (our word, his meaning) of partnership. He anticipated the
European Commission, Japan, Russia, South Korea and France in its
national capacity may all want to be on the roster of contributors
as a door-opener to their respective industry actors. Liu said he
and the IAEA Secretariat expected extrabudgetary contributions for
this project to be forthcoming well in excess of the USD 2 million
budget target, and his mission was already discussing with the
Office of the Legal Adviser how, procedurally with Board concurrence
and practically, to apply excess funds. He encouraged U.S.
participation as well.

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COMMENT
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5. (SBU) The IAEA and China received approval from the November 2008
TACC and Board of Governors meetings for this project and the
Chinese Government sees this as a priority TC project for the
2009-2011 cycle. Almost all member states in the March 2009 Board
highlighted their concerns regarding large gaps in human resource
capacity in the nuclear energy sector. China is progressively
looking to fill that gap by creating a model that serves its
national purposes as well as future regional aspirations. By
opening up the training centers to the region, the Chinese can
create a stand-alone "business" funded by other countries and
subsequently export their knowledge and best practices in this

sector. This also supports China's desire to promote technology
transfer and capacity building throughout the region.


6. (SBU) In a separate conversation with Msnoffs, the IAEA's TC
Director for Europe Peter Salema (TC Director for Asia until he was
replaced last month by a Chinese national) shared that China's
primary goal during the project planning stage with the TC Division
was to make this a regional model which could be exported to other
parts of the world. Salema said this is not surprising since China
wants to be seen "as the big brother to the developing world" and in
the nuclear sector would like to use "partnerships" to get to
resources such as uranium, oil, and gas. Salema said he had
advocated for the TC project, not because of the regional component,
but because this project presented an opportunity for the IAEA to
work with China in a transparent way to ensure China has the
infrastructure to run its nuclear power program. With relation to
the TC program, Mission counts the Chinese approach of making its
case for funding to a broader audience than the IAEA TC department
alone as a positive example for other beneficiary states.


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