China accuses UK of undermining investor confidence after steelmaker’s nationalisation

China has voiced its "firm opposition" to the UK government's decision to nationalise British Steel, the country's last remaining primary steelmaker and a subsidiary of China's Jingye Group, warning that the move could undermine confidence among Chinese investors.

The UK formally nationalised the struggling steelmaker this week, as British media reported, saying the intervention was necessary to safeguard national interests amid concerns that Jingye was preparing to shut down the company's blast furnaces.

Beijing criticised the decision, arguing that Jingye had invested heavily in British Steel since acquiring the loss-making company in 2020. China's Commerce Ministry said it was "dissatisfied" with the nationalisation, according to state-run Xinhua News Agency.

"The UK side, ignoring Jingye's significant contributions to its economy and society, forcibly took over and nationalized the company in the name of national security, which has seriously undermined Jingye's legitimate rights and interests and severely dampened the confidence of Chinese enterprises in investing in the UK," Chinese agency Xinhua quoted the ministry as saying.

The ministry urged London to comply with international rules, honour its obligations under the China-UK investment protection agreement and ensure Chinese-invested companies receive fair and equitable treatment.

Beijing also said it would closely monitor developments, support Chinese companies in protecting their rights through legal channels and take "strong measures" to safeguard their interests.

Strategic asset under pressure

British Steel is the UK's only producer of primary steel, supporting around 2,700 jobs at its main steelworks in Scunthorpe as well as throughout the wider supply chain.

Jingye, one of China's 100 largest companies, acquired British Steel for £70 million (approximately $94 million) in 2020 after the company entered insolvency. Despite substantial investment, the business continued to struggle financially and was reportedly losing around £700,000 (approximately $942,000) per day by 2025.

Plans for government intervention had been gathering pace for more than a year. In March 2025, Jingye launched a consultation that concluded the steelmaker was no longer financially viable.

Concerns intensified the following month when reports emerged that the company had cancelled orders for a critical raw material used in steel production, fuelling fears that it intended to shut down the blast furnaces permanently.

The UK government responded by taking operational control of British Steel to prevent production from ceasing. While Jingye retained legal ownership, control of the company's operations passed to the government.

This week, ownership was formally transferred to the UK government. Ministers said an independent valuer would be appointed to determine "whether any compensation is payable" to Jingye.

The nationalisation marks a significant escalation in tensions over Chinese investment in strategic UK industries, with Beijing warning the decision could have broader implications for future Chinese investment in Britain.

By Nazrin Sadigova