Exclusive | How US nuclear sanctions on China backfired
Washington’s strict blacklist rule amid national security concerns has forced Beijing to become self-sufficient with ‘incredible’ results
“I couldn’t close my mouth in amazement,” she admitted, stunned by China’s advanced capabilities and “incredible” industrial scale.
This awe-inspiring progress exists despite stringent US sanctions – including the 2019 blacklisting of China General Nuclear Power Group (CGN) and the recent suspension of equipment licences – imposed over national security concerns.
Now, as the US and Europe struggle with costly delays and atrophied supply chains in their own nuclear expansions, China’s sanctioned industry has become an unattainable benchmark of efficiency – and its exclusion threatens to stall the West’s own atomic energy revival.
“The current geopolitical situation at all levels is incredibly complex. But our position has always been that the nuclear industry is global, and we would like to see countries working together and sharing best practices and lessons learned,” said Bilbao y León.
The industrial leader, originally from Spain, has been calling on member countries to strike a balance between global cooperation and local participation to ramp up the supply chain.
The world is in a heated race to expand nuclear power capacity, with major countries – particularly the US and China – announcing ambitious goals recently, driven by concerns about climate change mitigation and energy security.
“Many countries are looking to triple or even quadruple their nuclear capacity, but achieving these goals will require rebuilding and reintegrating supply chains and industrial capabilities,” Bilbao y León told the South China Morning Post in an exclusive interview at the end of July.
“Everybody is taking note of what is happening in China,” she added.
History shows that supply chain bottlenecks have already stifled mega nuclear projects in developed countries. However, as geopolitical tensions intensify, Chinese technologies and suppliers are increasingly being scrutinised or even blocked, by the West.
Kevin Tu, a non-resident fellow at the Centre on Global Energy Policy at Columbia University, said that, ideally, other countries could benefit from collaborating with China across multiple areas – such as plant design, construction, equipment procurement and talent training – as Beijing had undertaken one of the fastest nuclear power build-outs in history in recent years.
But the reality is far more complicated. Given the sector’s highly sensitive nature, it “will inevitably become politicised”, making international cooperation with China difficult, Tu noted.
Philip Andrews-Speed, senior research fellow at the Oxford Institute for Energy Studies, wrote in an email response to the Post that, “I think it is unlikely that any Western country – Canada, the US, Japan, South Korea, the UK or most EU member states – will choose a Chinese company as a vendor for a nuclear reactor for as long as distrust remains at current or higher levels.”
For example, last May, Hungary and China signed a nuclear energy cooperation agreement, encouraging capable Chinese enterprises to invest in Hungary. But Andrews-Speed pointed out that Hungary’s nuclear sector contracts have actually gone to Russia, their long-term nuclear technology supplier.
In 2022, China’s state-owned group CGN – which held a 20 per cent stake in the Sizewell C nuclear power plant project in Suffolk, eastern England – was forced to withdraw by the British government amid national security concerns.
Despite breaking ground on its first reactor almost 40 years after the US pioneered the tech, China is now building far more fission power plants than any other country. Around 10 new reactors have been approved by the Chinese government each year since 2022, putting China on track to overtake the United States and become the world’s largest generator of nuclear power by 2030.
According to data from the World Nuclear Association, seven of the 10 most recent projects to begin construction since last July belong to China, while the other three are from Russia, South Korea and Pakistan.
Thanks to the rapid development over the past three to four decades, “the entire industrial chain has been well-established”, said Zhao Chengkun, former executive deputy director of the expert committee of the China Nuclear Energy Association, with around 90 per cent of equipment domestically produced.
Meanwhile, China has established a robust system for cultivating a stable pool of skilled personnel, with a significant demand for professionals in the industry and related subjects in higher education, Zhao added.
Andrews-Speed, from the Oxford Institute for Energy Studies, echoed Zhao.
“China has built an almost complete supply chain for nuclear power, along with the skilled labour force needed to build and operate the world’s fastest-growing fleet of plants,” he said.
However, the story is different when it comes to countries like the US and France – which once dominated nuclear technology development. Due to historical reasons such as public opposition, rising costs and regulatory challenges, construction of large-scale nuclear power plants in these countries has stagnated for decades.
“US and most European countries have not consistently built nuclear power plants, particularly gigawatt-scale pressurised water reactors, for many years. As a result, their industrial supply chains and talent bases have weakened considerably over time,” Tu said.
From a pragmatic standpoint, developing a robust supply chain takes time and necessitates international cooperation. Partnering with Chinese manufacturers represented a viable option, Tu said, “if political trust is rebuilt and geopolitical tensions are eased”.
02:24
A look inside the world's largest nuclear fusion reactor in Japan
The progress made by China and the West in developing third-generation nuclear power technology reflects precisely the impact that supply chain maturity can have on project construction.
The Flamanville Unit 3 reactor in northern France is owned and operated by the French company EDF. The project began in 2007, with commercial operations initially scheduled to start in 2012.
However, it has been repeatedly delayed due to various factors. In 2023, for example, work was halted for several months due to issues with welds in the main secondary system. The reactor was finally connected to the grid by the end of 2024, and the project has cost at least five times more than originally anticipated.
The Plant Vogtle Unit 4 in the state of Georgia – one of the first new nuclear units to come online in the US in over 30 years – is based on Westinghouse’s third-generation plus AP1000 reactor technology. Yet the project also faced an overall delay of around seven years and cost overruns, partly due to manufacturing defects and delays in delivering critical components, such as the main pump.
In contrast, the Fuqing 5 unit in southeastern China’s Fujian province – the first Hualong One model to enter commercial operation globally – set a record for construction time. It began construction in 2015 and entered commercial operation in January 2021 at a cost 20 to 30 per cent lower than that of its foreign competitors.
Although the Hualong One design was modelled on foreign technology, this milestone project has greatly boosted China’s self-reliance in terms of its supply chain and workforce.
According to a 2021 report by Communist Party mouthpiece People’s Daily, the project involved over 5,300 suppliers nationwide, with all core equipment produced domestically. The project also helped China to train professionals in the core technologies and construction of third-generation nuclear power plants.
China has exported at least 15 nuclear power units and research facilities worldwide. The K2 unit at the Karachi Nuclear Power Plant in Pakistan, which started operating in May 2021, is the first overseas nuclear power unit to use the Hualong One model.
04:09
Israel launches strikes on Iran, targeting nuclear facilities in Tehran
In an article published in the prestigious journal Nature on July 28, several researchers from US institutes, including Harvard Kennedy School, examined how China had succeeded in avoiding the “cost escalation curse” faced by the nuclear industry through regulations and supply chain efforts.
China has been researching and developing its own reactor design based on French technology for two decades and has been producing simple components domestically for an even longer time.
Some Chinese-made nuclear components, such as tubes, ring cranes and charging pumps, cost half as much as their imported equivalents, according to the study.
In some cases, however, importing nuclear technologies is a more strategic choice, the author noted, citing the example of France’s deviation from the tried-and-tested US reactor design in favour of a national version in the 1980s, which hindered standardisation and caused construction costs to rise.
“As countries rush to expand nuclear capacities, they must combine affordability with safety, scalability, investor confidence and public trust. Without this, nuclear power will remain an expensive bet the world can ill afford,”the Nature article concluded.
Nuclear power is undergoing a global resurgence, with more than 30 countries pledging to triple global capacity by mid-century. Technology giants, including Amazon, Google and Microsoft, are also investing in nuclear power to fuel their energy-intensive AI data centres and reduce carbon emissions.
In May, the new German government dropped its long-held opposition to nuclear power. Denmark is also considering lifting its 40-year ban on atomic power to enhance its energy security amid the Europe-wide shift.
Also in May, US President Donald Trump signed executive orders to accelerate the construction of additional nuclear capacity with the goal of quadrupling the country’s installed capacity to 400 gigawatts (GW) by 2050.
“Many countries have realised that there is a dire need for abundant, affordable, clean energy and electricity that is available 24/7,” said Bilbao y León.
For many countries, it is simply not possible to meet carbon emission goals in a cost-effective, timely manner without doubling down on nuclear power, and the quest for energy security and independence is increasingly urgent, she explained.
On top of that, as the world rapidly becomes more electrified, affordable new energy sources are needed to power industrial development and hi-tech sectors such as AI.
Andrews-Speed believes the issue for Western nuclear development is the ability to deliver projects on time and on budget – a management problem that will not easily be solved with China’s help only in the form of equipment and workforce. “But most Western governments would not allow a Chinese company to build one of their own reactor designs for them,” he said.
Nevertheless, he added that once Western companies get into the practice of building several reactors of the same design, they should become more efficient.