EXCLUSIVE-China exec gets 20 years for leaking secrets

by Reuters
Tuesday, 28 September 2010 08:08 GMT
By Benjamin Kang Lim

BEIJING, Sept 28 (Reuters) - The disgraced president of a Chinese state-owned enterprise has been jailed for 20 years for leaking state secrets in connection with a bid for foreign-made nuclear reactors, two sources with knowledge of the matter said.

The harsh sentence for Jiang Xinsheng came five months after a Shanghai court sentenced a China-born Australian national who headed Rio Tinto's iron ore operations in China and three Chinese colleagues to prison terms ranging from seven to 14 years for stealing commercial secrets and taking bribes.

The Rio case, along with Google's dispute with China over Internet censorship and hacking complaints, has stoked investors' worries about the risks of doing business in China, the world's second largest economy by some measures.

Jiang was charged with disclosing information to France's Areva, the world's largest builder of nuclear reactors, about a 2004 bid for China's inland nuclear programme, according to Caijing magazine.

Asked to comment, an Areva spokesperson in France said: "Areva considers that there is no basis to these allegations."

China has not accused Areva of any wrongdoing.

A Beijing court convicted and sentenced Jiang, a former president of China National Technical Import and Export Corp, which builds power plants, last month on charges of leaking state secrets and accepting bribes, two sources told Reuters. They requested anonymity due to the sensitivity of the case.

Court officials, reached by telephone, declined to comment.

The company could not be reached.

Caijing, an influential Chinese business publication, reported Jiang's detention in 2008, but his fate since then had not been disclosed.

U.S.-based Westinghouse, controlled by Japan's Toshiba Corp, signed an agreement with China in 2006 to build four AP1000 reactors in the eastern coastal provinces of Shandong and Zhejiang, beating Areva in a tight two-way contest.

Westinghouse won after agreeing to a technology transfer deal that would make the untested AP1000 technology the basis for China's own-brand third-generation reactor.

China is planning a massive push into nuclear power in an effort to wean itself off coal, the dirtiest fossil fuel.

It now has 12 working reactors with 10.15 gigawatts of total generating capacity.

China's official nuclear capacity target for 2020 remains 40 GW, less than 5 percent of its current installed electricity generating capacity, or enough to power Spain. However, officials said China is considering raising the goal to 80 GW or more for 2020. Jiang, who joined the company in 1979 and turns 56 this year, is the second high-profile SOE official to be jailed this year for leaking secrets.

In March Tan Yixin, once touted as the future head of steelmaker Shougang, was sentenced to three and a half years in prison and fined 300,000 yuan ($44,000) for leaking commercial secrets to Rio Tinto's China-based employees.

(Additional reporting by Muriel Boselli in Paris; Editing by Don Durfee, Ken Wills and Alex Richardson)

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