French government threatening to scupper controversial Chinese rescue deal for British Steel
The French government is threatening to scupper the controversial Chinese rescue deal for British Steel.
Economy minister Agnes Pannier-Runacher has warned that her government is prepared to block the sale of British Steel’s profitable French arm to China’s Jingye, putting the whole agreement at risk.
She was speaking after France Rail – an arm of British Steel which is a major supplier of rails to the French railway network – agreed to buy steel from the struggling Ascoval mill in northern France.
Too hot to handle: Jingye agreed a rescue deal with the UK Government for British Steel last month
There are fears in the UK that this deal could lead to a loss of business for British Steel’s Scunthorpe plant.
Ascoval is part-owned by Greybull, the controversial private equity group that owned British Steel when it fell into administration in May.
Jingye agreed a rescue deal with the UK Government for British Steel last month, but the plan has raised national security concerns amid claims that it could give the Chinese political leverage in Britain.
Pannier-Runacher said last week that the deal could be blocked if the French ‘do not have all the guarantees’.
She also noted that European steelmaker lobby groups had raised concerns about cheap Chinese steel being a major problem for the industry.