Britain secures the last steel factory against Chinese takeover

Britain secures the last steel factory against Chinese takeover

London - the British parliament was only called in times of national crises, but when the MPs came back from their Easter break last weekend, the reason was not a war, a terrorist attack or the death of a monarch, but the impending closure of a Stahlwerks in northernland.

nationalization and control of the steel mill

The government announced that the owner of the British Steel location in Scunhorpe, the Chinese company Jingye, is willing to cancel orders for the raw materials that are necessary to keep the blast furnaces into operation. A step that would mean that Great Britain could no longer produce new steel for the first time since the industrial revolution.

Parliament voted to take over the emergency control over the work-according to reports, even the police were used to deny Jingye employees. Jonathan Reynolds, the Minister of Economy, explained that a complete nationalization of the work was "likely", which means that the government would soon have to lead a complex and costly production operation - a task that has been outsourced for a long time.

British steel production in the decline

Great Britain, once a steel giant, now plays a subordinate role. It only makes up 0.3 % of global steel production and imports large amounts of alloy to meet domestic needs. The hurried decision of the government to regain control of Jingye's work in Scunhorpe has offered an insight into how countries and Great Britain navigate in an economically insecure world: On the one hand, they remain obliged to the principles of globalization, which US President Donald Trump challenges; On the other hand, they try to protect industries that are considered strategically too important to leave them to the market forces.

The challenges of globalization

The ownership of British Steel has changed several times since privatization in the 1980s, but Jingye's term was particularly challenging. A oversupply of chinese steel Operating costs, in particular the energy costs, are significantly higher than elsewhere. Jingye claims that the work in Scunhorpe loses £ 700,000 daily (approx. 926,000 US dollars), despite considerable investments, which makes it "no longer financially portable".

political effects and nationalism

lin Jin, a spokesman for the Chinese Ministry of Foreign Affairs, warned Great Britain on Monday that economic and trade collaborations do not transform into political and security issues so as not to endanger Chinese companies.

The negotiations with the British government to stabilize British Steel finally failed. In an emergency debate in parliament on Saturday, Reynolds indicated that the company was ready to sabotage the work. "His intention was to cancel existing orders for iron ore and coal," he said, "he said, which" would close the primary steel production at British Steel irrevocable and one -sided ".

a turning point for the British economy?

With the "probable" complete nationalization of British Steel, as Reynolds noted, some in the country wonder whether Great Britain turns from the economic Orthodoxy, which has existed by Margaret Thatcher in the 1980s since the privatization of fundamental industries.

Jeremy Corbyn, the left-wing ex-chair of the Labor Party, asked the government to "bring the entire steel industry into public property" during the debate on Saturday in order to finally "free them from the market forces." However,

Edgerton warned against seeing the decision as a “start of a new policy”. "I do not think that economic internationalism will be undermined in this case ... because there will be no controls for (steel) imports. It will only be a question of subsidizing production in a single work," he said

The decision also raises questions about the unclear China strategy of Great Britain. Former Prime Minister David Cameron praised a "golden era" of British-Chinese relationships and took XI Jinping into a pub from the 16th century during a visit in 2015.

later, under the former Prime Minister Boris Johnson, relationships deteriorated. Despite the approval of British Steel's sale on Jingye months earlier, Johnson's government banned the Chinese telecommunications giant Huawei in Great Britain 5G network, citing security concerns.

Since he came to power last summer, Strauber is trying to rewrite China, albeit without Cameron's enthusiasm. After he promised to restore economic growth in the election campaign, finance minister Reeves visited Beijing in January to attract Chinese investments. But the controversy around Jingye and British Steel could endanger the Labor Party's advances.