China ‘strongly dissatisfied’ with nationalisation of British Steel | British Steel

The Chinese government said this week it was “strongly dissatisfied” with the decision to nationalize British Steel, 15 months after the UK government intervened to prevent the closure of steelworks in Scunthorpe and the loss of 4,000 jobs.

On Thursday the government announced British Steel was being taken into public ownership to safeguard the “future of steelmaking”.

The Department for Business and Trade said the move was necessary to maintain steel production at the company’s site in Scunthorpe, Lincolnshire, to protect the company’s future and UK supply chains.

However, China’s Ministry of Commerce (Mofcom) said the move “deals a serious blow to Chinese companies’ confidence in investing in the UK.”

British Steel was previously owned by the Chinese company Jingye. The Labor government moved to urgently recall parliament in April last year to prevent the closure of British Steel after Jingye threatened to leave without taking necessary steps to protect the blast furnaces in Lincolnshire.

A Mofcom spokesperson told Chinese media outlet Global Times: “Ignoring Jingye Group’s significant contributions to the British economy and society, the UK side forcibly seized control of British Steel and then nationalized the company in the name of national security, seriously undermining Jingye’s legitimate rights and interests and dealing a serious blow to the confidence of Chinese companies to invest in the UK.

“China is firmly opposed to the UK government’s decision and is strongly dissatisfied with it. China will follow developments closely, support Chinese companies to protect their rights through legal means, and take strong measures to strictly protect the interests of Chinese companies.”

Jingye has argued on his UK accounts and in comments on his WeChat social media account that British Steel is a valuable asset worth huge compensation, although he is prepared to walk away and let it fail.

The government plans to appoint an independent appraiser to determine how much compensation should be paid to Jingye to avoid legal action under international agreements.

A Mofcom spokesman reportedly said that the UK government must “comply with relevant international rules, solemnly fulfill its obligations under the China-UK bilateral investment agreement, treat Chinese companies operating in the UK fairly and impartially, and fully protect their legitimate rights and interests.”

The UK government said a new leadership team had been appointed to focus on stabilizing the business following Thursday’s nationalization and transforming it into a “commercially sustainable, low-carbon organisation”.

Keir Starmer confirmed the nationalization on Thursday, in one of the last major actions he oversaw as prime minister, saying: “British Steel is part of the fabric of our nation and the cornerstone of Britain’s industrial strength.

“Today’s decision secures the future of steelmaking in the UK, protects skilled jobs and secures a vital national talent.

“This government will always act in the national interest to support British industry, strengthen our economy and ensure the industries we rely on thrive long into the future.”

The announcement comes after the Steel Industry (Nationalization) Bill 2026 received royal assent and became law. The new law allows ministers to transfer shares or property of steel businesses into public ownership.

The nationalization of British Steel marked the end of the geopolitical flare-up between Britain and China. Earlier this year, Starmer traveled to China in a bid to bring “stability and clarity” to relations between the two countries after years of “inconsistency”.

Last year the government finalized a £38bn deal to support Britain’s biggest nuclear project, Sizewell C, after unwinding China General Nuclear’s 20% stake in 2021 due to security fears.

In 2020, Boris Johnson angered China by ordering equipment manufactured by Huawei to be removed from Britain’s 5G phone networks.

While Donald Trump praised the decision (the US had put political pressure on countries to ban Huawei, citing national security concerns), China’s ambassador to the UK criticized the move, saying it “becomes questionable whether the UK can provide an open, fair and non-discriminatory business environment for companies in other countries.”

The two countries have had better relations in the past; The most famous was when David Cameron took Xi Jinping to a bar in 2015.

A year later Chinese company SinoFortone Investment bought the 16th-century Buckinghamshire pub, which has since become a tourist attraction for Chinese visitors.

PA Media contributed to this report.