France to hawk nuclear power, planes during China visit

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President Nicolas Sarkozy is to set out France's stall as a supplier of cutting edge nuclear and aviation technology this week as he hosts his Chinese counterpart Hu Jintao on a three-day state visit.

Sarkozy also hopes to win Chinese support for his agenda as the next chairman of the G20 group of economic powers, a year-long role in which he hopes to ease global exchange rate tension and regulate commodity markets.

Hu is to arrive in France on Thursday and stay until Saturday. During the visit, alongside the full pomp and ceremony of a formal state visit, he will hold a number of working meetings with his French counterpart.

France hopes to sign contracts for plane maker Airbus to sell around 100 passenger jets to Beijing and for French participation in the next stages of the Taishan nuclear plant in southern China.

According to the French financial daily Les Echos, nuclear giant Areva hopes to advance the sale to China of two new generation EPR reactors and to win a three billion dollar deal to supply Chinese energy group CGNPC with uranium.

This would see the French firm supply the China Guangdong Nuclear Power Corp with 20,000 tonnes of uranium over the next 10 years, the report said.

Ties between France and China have been tense in recent years following a number of diplomatic spats, but Sarkozy and Hu patched up relations during a visit by the French leader to Beijing in April.

Since then, Hu has adopted a more friendly tone, telling the pro-government French newspaper Le Figaro that China wants to go beyond simple commercial and investment issues to create a "partnership of equals" with Paris.

This will involve "new partnerships in energy, the environment, information technology, high-end industry, new energy sources and new materials," Hu said.

Tough negotiation lies ahead over the exchange rate issue, however.

Western powers, in particular the United States, reproach China for keeping the yuan at too low a level -- keeping the price of Chinese exports down and thus generating huge trade imbalances with importing nations.

France takes over the rotating presidency of the G20 on November 13, just after the Chinese visit, and Sarkozy hopes to hammer out a deal to relieve tensions and head off the risk of what some dub a "currency war".

Friendly talks with Hu in Paris this week can only help in this regard -- and French officials say there can be no solution to the crisis without China's support -- but few observers expect Sarkozy to make much early headway.

"China's currency policy is coherent and responsible. We have worked steadily to advance reform of the yuan exchange rate mechanism," Hu told Le Figaro, signalling Beijing's unwillingness to change its policy.

"To redress commercial imbalances, the parties concerned must change their pattern of development, restructure their economies and promote free and fair trade, fighting any form of trade protectionism," he insisted.

China points out that the yuan has been allowed to appreciate by nearly 24 percent since 2005, and Sarkozy has been careful not to put as much overt public pressure on his new friend as some European leaders.

"If France's ambition is to get real reform of the international financial system, with Chinese support, it won't get very far," warned Valerie Niquet, director of Asian affairs at the Foundation for Strategic Research.

"If it only wants to demonstrate leadership on financial questions then, for that, Beijing could play a role in supporting the French position."

With this in mind, France kept a low profile last month when the Norwegian Nobel Committee awarded its 2010 Peace Prize to jailed Chinese pro-democracy activist Liu Xiaobo, enraging Beijing.

Sarkozy -- having previously in 2008 angered China by meeting the Tibetan spiritual leader the Dali Lama -- pointedly failed to welcome the award, leaving Foreign Minister Bernard Kouchner to issue a brief statement.

After his visit to France, Hu will head on to Portugal.

© 2010 AFP

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