China has warned the United Kingdom that its decision to nationalise British Steel could damage investor confidence unless the dispute is resolved fairly.
In a statement issued on Saturday, China's Ministry of Foreign Affairs said it is closely monitoring the UK's takeover of British Steel, which was previously owned by Chinese firm Jingye Group. Beijing urged the British government to protect the legitimate rights of Chinese investors and negotiate a mutually acceptable settlement, including compensation for losses.
Jingye, which acquired British Steel in 2020 for £70 million, has said it suffered heavy financial losses while operating the company and is seeking compensation following the UK's decision to bring the steelmaker under full state ownership.
The UK government nationalised British Steel on Thursday, saying the move was necessary to safeguard national security, protect thousands of jobs, and secure the country's steel production capacity. British Steel operates the UK's last remaining primary steelmaking plant in Scunthorpe, supporting around 2,700 direct jobs and thousands more across the supply chain.
British officials argued that government intervention became necessary after concerns that Jingye could shut down the plant due to mounting financial losses, potentially leaving the UK as the only G7 nation without the ability to produce virgin steel.
China warned that how Britain handles the compensation issue will influence the confidence of Chinese businesses investing in the UK and shape public opinion in China regarding the British government's credibility.
The dispute adds to growing economic and political tensions between Beijing and London over investment, trade, and national security.
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