Why China is planting its flag on what’s left of British Steel

It cannot be other than good news that a rescuer has been found for the bankrupt remains of British Steel, and in particular for its ‘long products’ plant at Scunthorpe — even if the buyer, at a token £50 million but with a promise of £1.2 billion of investment, is a little-known Chinese group, Jingye, owned by a former communist party official, Li Ganpo. Jingye has stepped in after potential offers from the Anglo–Indian tycoon Sanjeev Gupta and a Turkish steelmaker, Ataer, failed to firm up. Some 4,000 British Steel jobs, and many more in its supply chains, will be saved if this deal goes through. But still we might wonder at Jingye’s motivation.

Chinese dumping of cheap steel has already wreaked havoc in the rest of the world; it seems unlikely there’s anything Scunthorpe can make that Shanghai can’t make cheaper, or that Mr Li is excited about orders from UK infrastructure projects that might never happen, such as HS2, let alone British Steel’s potential to win business from our soon-to-be-former EU partners. No, this looks very much like a flag-planting exercise designed to remind us of China’s industrial might. The strategy is nothing subtle: it’s about being big and being everywhere.

What to tell Tory candidates

We’re not in recession, having achieved a 0.3 per cent expansion in the third quarter following a negative second quarter; July was a good month but the ONS says the UK economy narrowly contracted again in August and September. Growth overall is at 1 per cent, which is pretty dismal even if no worse than continental Europe, and no one claims to have sighted a recovery of business investment. Be thankful, then, that the threat of Jeremy Corbyn has receded after Nigel Farage’s decision not to contest Tory seats.