Australia and China sign uranium deal

Australia and China have signed a nuclear safeguards deal to allow Beijing to import Australian uranium for power generation.

    Wen Jiabao (R) and John Howard seal the deal

    The deal was signed in the presence of Wen Jiabao, the Chinese premier, and John Howard, the Australian prime minister.

    China is expected to build 40 to 50 nuclear power plants over the next 20 years and needs steady supplies of uranium.

    Australia has about 40% of the world's known uranium reserves, but it allows sales only to countries that have signed the Nuclear Non-Proliferation Treaty (NPT) and which also agree to a separate bilateral safeguards deal.

    Start date

    However, Ian Macfarlane, the Australian resources minister, said big uranium exports to China were unlikely to start until 2010.

    China plans to build up to 40 new
    nuclear power plants

    "Australia is already fully committed in terms of uranium production through until about 2008, bearing in mind that the signing of this agreement means that this is really only the start of the process," Macfarlane told Australian radio.

    He said that once the safeguards deal was signed, China would need to begin commercial negotiations with uranium producers in Australia, and new mines would probably need to be developed that would require licensing by the government. Australia has only three operational uranium mines.

    "Realistically, in terms of any significant quantity we are probably looking at some time past 2010," Macfarlane said.

    Analysis

    Some analysts have said the safeguards deal between Australia and China, which are also negotiating a free trade deal, will test Canberra's skills at juggling ties with Asia's emerging power and its alliance with the United States.

    Australia's willingness to co-operate with Beijing has highlighted differences with the US, which is suspicious of China's military and economic ambitions.

    Australia has 19 bilateral nuclear safeguard agreements, covering 36 countries, including the United States, France, Britain, Mexico, Japan, Finland and South Korea.

    Under the NPT, the five nuclear-weapon states - the US, Russia, the United Kingdom, France, and China - are barred from transferring nuclear weapons, other nuclear explosive devices, or technology to non-nuclear-weapon states and those that have not signed the treaty.

    SOURCE: Reuters


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