The Chinese government has expressed strong dissatisfaction with the UK's decision to nationalise British Steel, warning that the move undermines Chinese companies' confidence in investing in the UK. On Thursday, the UK Government brought British Steel under public ownership to secure the future of steel production at its Scunthorpe site in Lincolnshire, citing the need to protect the company's viability and UK supply chains.
China's Response and Concerns
China's Ministry of Commerce (Mofcom) issued a statement via The Global Times, accusing the UK of disregarding Jingye Group's contributions to the British economy. Jingye, a Chinese company, had previously owned British Steel. A Mofcom spokesperson said: 'The UK side, disregarding Jingye Group’s important contributions to the British economy and society, forcibly took control of British Steel and subsequently nationalised the company in the name of national security, seriously undermining Jingye’s legitimate rights and interests and dealing a severe blow to Chinese companies’ confidence in investing in the UK.'
The spokesperson added that China 'firmly opposes and is strongly dissatisfied' and will 'take strong measures to firmly protect the interests of Chinese companies.' They urged the UK to abide by international rules and the China-UK bilateral investment treaty, treating Chinese firms fairly.
Background and Nationalisation Process
British Steel had planned to close its Scunthorpe blast furnaces, but Parliament was recalled in April last year to pass special legislation to keep the plant open. The nationalisation was enabled by the Steel Industry (Nationalisation) Act 2026, which received royal assent and allows ministers to transfer steel businesses' shares or property into public ownership.
Following the nationalisation, a new leadership team was appointed to stabilise the business and transition it into a 'commercially sustainable, low-carbon enterprise,' according to the UK Government.
UK Government's Justification
Prime Minister Sir Keir Starmer defended the decision, stating: 'British Steel is part of the fabric of our nation and a cornerstone of Britain’s industrial strength. Today’s decision secures the future of steelmaking in the UK, protects skilled jobs and safeguards a vital national capability.' He emphasised that the government will act in the national interest to support British industry.
The Department for Business and Trade said the move was essential to maintain steel production and protect the company's future and UK supply chains.
Impact on UK-China Relations
The nationalisation adds tension to UK-China relations, particularly regarding investment confidence. China has vowed to monitor developments and support Jingye in legal recourse. The UK government has not yet responded to China's specific allegations.
