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Cablegate: Talk of Brazil-China Nuclear Cooperation Overstated

This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L BRASILIA 001503

SIPDIS

HICPAC OIC PASS TO USPACOM HONOLULU HI

E.O. 12958: DECL: 06/17/2014
TAGS: KNNP ETTC KSCA PREL BR CH
SUBJECT: TALK OF BRAZIL-CHINA NUCLEAR COOPERATION OVERSTATED

REF: A. BEIJING 9600 B. BEIJING 9152 Classified By: SCI/C Daniel Rubinstein. Reasons 1.4 (b,d).

1. (C) SUMMARY. Much was made in the Brazilian press about an apparent agreement reached between Brasilia and Beijing during Lula's May visit to China to cooperate on nuclear energy and technology. The story was exaggerated. It is now clear that little more than inchoate informal agreements to study the issue were reached. Real exchanges of materials or technologies will occur only years down the road, if ever. END SUMMARY.

2. (C) Guilherme Patriota, Senior International Affairs Advisor at the Brazilian Ministry of Science and Technology (MCT), told Sci/C that President Lula's comments on nuclear cooperation with Beijing during his China trip in May were not well coordinated within the GoB, and that early press coverage of Lula's and Minister of Science and Technology Eduardo Campos's comments was misleading. NOTE: MCT is the parent ministry of the GoB's umbrella nuclear agency CNEN. END NOTE. As the GoB later made clear in public statements, no new agreement in the nuclear field was signed, nor were any draft MOUs, LOAs or other documents exchanged.

3. (C) Beyond mention during the May visit of the long-extant China-Brazil umbrella agreement on nuclear cooperation, there was merely oral agreement to examine nuclear cooperation further during the visit to Brazil of Chinese COSTIND Minister Zhang Yunchuan this coming August. Laercio Vinhas, Senior International Affairs Advisor of Brazil's nuclear agency CNEN, confirmed to Consulate Rio de Janeiro the very general nature of the discussions during Lula's May trip. He added that, while China may be interested in sourcing raw uranium from Brazil, Brazil has yet to determine the magnitude of either its actual uranium reserves or its future domestic needs, given uncertainties in Brazil's own nuclear power program. In addition, domestic legal changes would likely be required to engage in such sales.

4. (C) MCT Advisor Patriota noted the contradiction between Lula's mention of possible joint Chinese-Brazilian uranium mining operations in Brazil and the sale of Brazilian uranium to China on the one hand, and the Brazilian Constitution and other laws on the other hand. All nuclear-related activities in Brazil are the sole dominion of the Brazilian federal government. Foreign governments, and private firms of any nationality - including Brazilian - are barred from activities such as uranium mining. The law similarly prevents the sale of uranium to non-Brazilian state entities.

5. (C) Patriota confirmed the concrete interest within some (pro-nuclear power) parts of the GoB and the state-owned nuclear industry to find new revenue streams for Brazil's money-starved nuclear power program, highlighting the specific goal of finding new business opportunities for state nuclear engineering and construction firm NUCLEP in participating in the construction of future Chinese nuclear power plants. Patriota conceded, however, that NUCLEP would find steep price and quality competition from Chinese and foreign firms in China for what are essentially mammoth construction jobs. There may exist secondary interest in finding buyers for raw Brazilian uranium assuming the laws are changed, but the value added of this type of trade is not very attractive for Brazil. More broadly, President Lula has mandated a broad interagency review of Brazil's entire nuclear sector, including the economic viability of the current modest program. Consequently, the likelihood of major new activities with foreign partners coming to fruition soon is highly doubtful.

HRINAK

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