Beijing—The Chinese corporation, Jingye Group, has called for compensation from the UK government following the nationalization of British Steel. This move came after Jingye indicated plans to shut down blast furnaces at the Scunthorpe plant in northern England, which is the final facility in the UK to produce virgin steel using raw materials.
In a statement on WeChat, Jingye Group criticized the UK government’s decision, claiming it damaged Britain’s credibility, frightened international investors, and inflicted financial losses on both the company and British taxpayers. Jingye has urged the UK government to cease violating international investment principles.
The company highlighted its intention to initiate discussions under existing bilateral investment agreements, preserving rights that include international arbitration. Jingye plans to advocate on behalf of British taxpayers, aiming to hold the UK government and British Steel’s leadership legally accountable, yet details of this approach remain unspecified.
Jingye accused the UK of disregarding its investments and contributions, offering minimal compensation. However, the UK government announced that an impartial assessment will determine any potential compensation for Jingye Group.
The Department for Business and Trade revealed the nationalization on July 17. It aims to save thousands of jobs and protect national interests by ensuring the supply of UK-produced steel for construction and defense projects. With over 130 years of history, British Steel has played a significant role in the UK’s steel industry, dating back to improvements during the Industrial Revolution. Presently, the Scunthorpe plant employs roughly 2,700 people.
Jingye’s acquisition of British Steel in 2020 helped the company avoid a crisis. The Chinese Foreign Ministry cautioned that the UK’s handling of the situation would impact Chinese investors’ views on the British investment climate and government credibility.
China has urged the UK to respect market principles and contractual obligations. Both parties are encouraged to find mutually agreeable solutions regarding compensation and other issues. China emphasizes supporting its enterprises in defending their legitimate rights through legal channels.