China General Nuclear Power Corp (CGN) is expected to invest around $7.93 billion in the Hinkley Point nuclear project.
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Just weeks after taking power Theresa May has landed her first major diplomatic row – with the Chinese government going nuclear over plans to pause the new reactor at Hinkley Point.
May has reportedly expressed concern in the past over the national security implications of the planned investment from China.
Security concerns centre on the one-third stake the Chinese state has in the massive project.
May might also have to contend with her first ministerial resignation if the deal does not go ahead, with friends of Lord Jim O’Neill – a Treasury minister close to George Osborne and charged with building relations with China – telling the Financial Times today that he will leave the government in September unless the prime minister can explain her change of tack over China. So, I think she has form in adopting a more suspicious approach, more in line with the American position.
“[It] not only draws queries from the global community about its [the UK’s] openness towards foreign investment, but also adds uncertainties to the “Golden Era” of China-UK ties”, the commentary said.
Former British cabinet member Vince Cable, who worked with May when she was home secretary, told media at the weekend that at the time she had been “anxious” about Chinese involvement. “But Osborne rejected it without explanation”, Davey said.
The proposed special share in the consortium would have enabled the Government to intervene on certain decisions to protect the national interest, he said.
There has been criticism of the guaranteed price EDF would be paid for power produced at Hinkley – £92.50 per unit of electricity.
Labour leader Jeremy Corbyn described the price levels involved as “disturbing” as he backed a review.
But the boss of EDF, Vincent de Rivaz, has tried to calm the fears of workers by insisting he understands why Mrs May wanted more time to consider the project, while insisting the deal was still “strong”.
The commentary, although not an official statement, does give insight into Chinese government, and said security suspicions could add uncertainties to the golden era of China-UK ties.
Business and Energy Secretary Greg Clark has insisted the Government will “carefully consider” all the component parts of the project.
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A comment from China’s official Xinhua agency says that while Beijing understands and respects Britain’s decision to reconsider the deal, it can not understand the “suspicious approach that comes from nowhere to Chinese investment in making the postponement”. “China can wait for a rational British government to make responsible decisions, but cannot tolerate any unwanted accusation against its honest and benign willingness for win-win cooperation”.
