China Expresses Concern Over UK's Move
The recent nationalization of British Steel by the United Kingdom has drawn criticism from China, which claims the action has negatively affected Chinese business interests in the UK. The British government took over the company, citing the need to protect national interests, after fears arose that its Chinese owners might shut it down.
Impact on UK-China Business Relations
The Chinese Ministry of Commerce issued a statement indicating that the takeover has "severely undermined" confidence among Chinese investors regarding the UK. British Steel, located in Scunthorpe, is the UK's last remaining steelworks and employs around 2,700 people directly and through its supply chain.
Financial Struggles and Ownership Transfer
Previously owned by the Chinese firm Jingye, British Steel has been financially troubled, with losses reportedly reaching £700,000 ($942,000) daily by 2025. Jingye, a major Chinese enterprise, acquired British Steel in 2020 for £70 million ($94 million). However, by 2025, the company deemed the operation financially unsustainable, leading to operational control being transferred to the UK government.
Timeline of Nationalization
The nationalization process began in March 2025, when Jingye initiated a consultation about the financial viability of the steelworks. By April, concerns grew as the company canceled orders for critical steelmaking materials, fueling speculation about a potential shutdown of the furnaces. In response, the UK government took operational control to prevent closure, though ownership remained with Jingye until the official transfer on Thursday.
Chinese Response and Future Implications
Following the official takeover, China accused the UK of "forcibly" taking over British Steel and "disregarding" the contributions Jingye made to the British economy. The Ministry of Commerce urged the UK to adhere to the China-UK Investment Protection Agreement and expressed its intention to support Chinese businesses in defending their rights.
The UK government, meanwhile, plans to appoint an independent assessor to determine if any compensation should be awarded to Jingye as part of the nationalization process.
Source: Original Article
