By Janaki Kremmer | Correspondent of The Christian Science Monitor
SYDNEY, AUSTRALIA - The Howard government has begun negotiations with Chinese officials to sell uranium to the energy-hungry Asian giant in a deal that is expected to be signed within 12 months.
Judging by the standards of supply and demand, the deal makes complete sense. China is expected to build 40 to 50 nuclear power plants over the next two decades and needs uranium to fuel them. Australia has it. China's Pacific neighbor is sitting on 41 percent of the world's easily extractable uranium.
The sale would be so good for Australia's coffers that the opposition has decided to back it. But the talks come amid close international attention to nuclear proliferation, as well as US concerns about arms sales to China. The uranium deal, critics say, raises uncomfortable questions about whether the uranium could be diverted to further China's nuclear weapons arsenal.
"It is setting a dangerous precedent of selling to a new country which is not an open society," says David Noonan, campaign officer on nuclear issues at the Australian Conservation Foundation. "We have concerns also about where this nuclear waste is going to be dumped and whether there will be enough checks in place to see that low-enriched uranium used for fuel is not then going to be reprocessed to produce plutonium - which is of course used to make bombs."
In recent years, Chinese officials have globetrotted from Russia to Latin America to Canada in an effort to ink new energy supply deals. China's booming manufacturing economy requires enormous amounts of energy to keep its factories running.
Australia is already a crucial energy supplier for China. Last year Canberra signed a $19 billion deal to supply China with liquefied natural gas and the two countries are expected to begin free trade talks when Prime Minister John Howard visits Beijing this month.
To help meet its energy demands, China has indicated that it is going to expand its nuclear-power capacity beyond its current nine nuclear plants.
In discussing the proposed export of uranium to China, Australia's Foreign Minister Alexander Downer told Parliament last month that the deal would only go through if China agreed to safeguards to ensure that the uranium would not be used to build nuclear weapons, would not be given to other countries, and would be safely handled.
But critics say that past international efforts at safeguards have not stopped some nations from using uranium for nuclear weapons programs.
"Australia pins all its hopes on the nuclear nonproliferation treaty which both [China and Australia] are signatory to," says James Courtney, a nuclear campaigner for Greenpeace. But "if things turn ugly over Taiwan, China could well decide to pull out of the NPT, and other than declaring war on China there is no way that you could get that uranium out."
Mr. Noonan cautions that there is no way of identifying "my uranium" from "your uranium" once it has left these shores.
"Once the Australian yellowcake mixes with Chinese uranium, we won't be able to keep tabs on what is ours and what is not. In any case once China gets our uranium it could easily free up its own stockpiles for military use, and then Australia would be seen as being complicit in its military program," he says.
However, China already has a significant stockpile of nuclear materials to draw upon if it wanted to build more weapons. A 1999 report by the Wisconsin Project on Nuclear Arms Control cites estimates of up to 4 tons of plutonium and 23 tons of highly enriched uranium - enough material for more than 2,000 nuclear weapons.
The department of foreign affairs and trade in Canberra says that, so far, the US has not commented on the possible uranium deal.
"Frankly, there is no bilateral safeguards agreement yet that anyone can take a look at to comment at this time," says an agency spokesman.
But Noonan says there is another reason for the silence.
"The main reason [why the US is not going to comment] is that Westinghouse is trying to sell four nuclear reactors to China, with an encouraging loan of 40 percent, in order to keep the nuclear industry in the US functioning as the US is not building any more reactors in its own country," he says.
The British-owned Pittsburgh-based company is believed to be bidding for the sale, along with the French firm Areva and its joint-venture partner Siemens. Russian and Canadian companies have also expressed interest in this project.
Former president Bill Clinton cleared the way for US reactor sales to China in 1998, under a bilateral cooperation agreement after Beijing promised not to sell nuclear technology to Iran.
Despite proliferation concerns, the uranium deal will probably go through, says Alan Dupont, strategic analyst at the Lowy Institute in Sydney. "The anti-uranium lobby's principal argument has been undercut as there is a recognition that nuclear power is useful in order to reduce global warming," he says.
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