France aims billion dollar trade with China

CHINA, French President Nicolas Sarkozy was due Monday to oversee billions of dollars in trade deals on day two of his visit to China, including an historic agreement to build two nuclear reactors.

French nuclear firm Areva announced it had finally secured an agreement with China worth eight billion euros (11.9 billion dollars) to build two third-generation nuclear reactors in southern China, ending months of negotiations.

"It's a record. In the history of the civilian nuclear industry, there's never been a deal of this magnitude," Areva chief executive Anne Lauvergeon told reporters as she gave the financial details of the partnership.

With China seeking to rapidly build up its nuclear power industry, the deal held even more significance for Areva after losing out in July to US-based Westinghouse Electric in a bid to build four other nuclear reactors.

"China is one of the most exciting markets. China is accelerating its nuclear development, and it's important to be part of this competition," Lauvergeon said.

Although no official figures were given for the Westinghouse deal, Chinese press reported at the time that it was worth eight billion dollars.

European aerospace giant Airbus was also likely on Tuesday to secure orders for as many as 160 planes to China, which is the world's fastest growing aviation market, according to sources involved in those talks.

The deals were due to be formally signed around 11:30 am (0330 GMT) after Sarkozy held talks with Chinese President Hu Jintao at the Great Hall of the People in Beijing.

Hu greeted Sarkozy for an official welcome at 9:30 am (0130 GMT), although the pair had already met on Sunday night for dinner during which a wide range of issues were discussed, including sensitive topics such as human rights.

Following his meeting with Hu, Sarkozy publicly urged China to revalue its currency and improve its record on the environment.

Speaking to French business leaders, Sarkozy also said China should play a more active role in resolving the Iran nuclear standoff and other international disputes, including the domestic political tensions in Myanmar.

"We need China to help find solutions to global problems," Sarkozy said. "China now plays an essential role in the global economy... by its very existence it changes the world balance. That brings with it rights, but also responsibilities, or rather duties."

Another key concern for Sarkozy is the revaluation of the yuan to help balance trade between France and China, which was 16 billion euros (24 billion dollars) in China's favour last year, according to French government figures.

"I hope to convince the Chinese that global harmony to which they are so attached must be developed through the equitable balance between the major currencies whether that be the dollar, the euro, the yen or the yuan," he said.

The environment is also a key focus for the French president in China, which is second only to the United States in greenhouse gas emissions that are blamed for climate change.

"China's economic growth should not and must not be achieved at the price of global environmental degradation, the exhaustion of natural resources and the speeding up of global warming," said the French leader.

The president arrived on Sunday in Xian, an ancient city southwest of Beijing. His tour ends on Tuesday, when he will visit the 2008 Beijing Olympic venues and Shanghai.

Beijing, Monday, AFP