The Vogtle Unit 3, being constructed by primary contactor Westinghouse, a business unit of Toshiba, near Waynesboro, Georgia, US. Photo: Reuters

Westinghouse Electric Co filed for bankruptcy protection on Wednesday, after incurring billions in cost overruns during the construction of nuclear reactors in the US.

The Wall Street Journal writes that the development threatens to complicate US-Japanese relations, as Westinghouse’s Japanese parent company, Toshiba, backs out of US nuclear projects under construction.

“The commitments are not just financial and operational, but there are moral commitments as well,” said Tom Fanning, CEO of Southern Company, the primary owner of two reactors under construction in Georgia. He added that 5,000 jobs are at stake should Toshiba renege on their commitment.

As for Toshiba, losses from the US nuclear projects have been devastating, and Chief Executive Satoshi Tsunakawa proclaimed that “[T]his is a de facto withdrawal from the overseas nuclear business for us. Therefore, we don’t see any more risk.”

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