The British government intervened to prevent the closure of a Chinese-owned steel mill in Scunthorpe, Lincolnshire, averting the loss of 2,700 jobs. This action followed unsuccessful negotiations with the Chinese owner, Jingye, who refused government subsidies. The government's actions have raised questions about future Chinese investment in sensitive sectors.
Parliament took control of the steel mill to prevent the shutdown of two blast furnaces. The government cited concerns about Britain's reliance on other countries for steel, a strategically important commodity. Accusations of bad faith and even sabotage against Jingye were rejected by British officials.
This incident has created tension in UK-China relations, despite recent efforts to improve ties. The government's actions highlight a concern about Chinese influence in strategic industries. The Business Secretary, Jonathan Reynolds, expressed reservations about allowing Chinese companies into the UK steel sector in the future.
Britain has sent a parade of senior officials to China this year, part of a calculated charm offensive to thaw out relations with a country that looms large in a world order upended by the United States under President Trump.
But an emergency move by the British Parliament last weekend to take control of a Chinese-owned British steel mill has struck a discordant note amid all the diplomacy. And it could raise deeper questions about Prime Minister Keir Starmer’s efforts to cultivate warmer ties with China, at a time when Mr. Trump’s tariffs are sowing fears about protectionism and fraying trade agreements worldwide.
Britain acted to prevent the Chinese company that owns the plant, in the town of Scunthorpe, Lincolnshire, from shutting down two blast furnaces, which could have shuttered the plant, cost 2,700 jobs and left Britain reliant on other countries for what it considers a strategically important commodity.
The government’s fruitless negotiations with the company, which refused subsidies to stay open, has prompted accusations of bad faith and even rumors of sabotage by the Chinese owner, which British officials rejected. But they are questioning whether other Chinese companies should be allowed to invest in sensitive industries.
“We have got to be clear about what is the sort of sector where actually we can promote and cooperate and ones, frankly, where we can’t,” Jonathan Reynolds, the business secretary, told Sky News on Sunday. “I wouldn’t personally bring a Chinese company into our steel sector.”
Mr. Reynolds said the Chinese company, Jingye, had refused to order vital raw materials, knowing that this would lead to the closure of the mill, Britain’s last big producer of crude steel, used in construction projects.
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