UK Retakes Control of British Steel from Jingye
In April 2025, the UK government retook control of British Steel after expediting emergency legislation in Parliament in a single day. UK Business Secretary Jonathan Reynolds stated that the Government plans to nationalize the Sunthorpe steelworks, which currently employs 2,700 people, mostly British. He explained that he sought emergency powers after Jingye revealed plans to shut down the facility.
Given the urgency of the matter, MP and peers were called back from their Easter holidays to debate the legislation in an extremely rare Saturday sitting of both the House of Commons and the House of Lords. Royal Assent followed quickly after the two Houses passed the law.
“Today, my government has stepped in to save British Steel. We are acting to protect the jobs of thousands of workers, and all options are on the table to secure the future of the industry … Our industry is the pride of our history — and I want it to be our future, too.”
UK PM Keir Starmer
Jingye plans to seek damages for alleged ‘illegal nationalization’ and laments the state interventionism. Others note that the expectation for Jingye to undertake a turnaround might have been too high, given that the plant has been loss-making for quite a while.
Some observers suggest that Jingye was not primarily interested in continuing the operation of the plant, but was more interested in the technologies behind certain special steels. Once Jingye mastered that know-how, the incentive to keep the plant running was gone.
A Jingye spokesperson declared that the UK government has to respect and protect the legitimate rights and interests of foreign investors. The Chinese embassy intervened and denounced the ‘arrogance, ignorance and twisted mindset’ of the British politicians. The UK government believes that Jingye ‘did not act in good faith.’
It is to be recalled that back in 2019, the then Conservative government approached Jingye with an offer to take over British Steel, after the previous owner, private equity Greybull Capital, basically wanted to ditch the asset given its foggy future.
The UK government even offered GBP 500 million in financial support to upgrade the highly polluting blast furnaces to lower-emissions electric arc furnaces. In return, Jingye will inject GBP 1.2 billion into British Steel to revitalize it. The project was trumpeted as a brave and gallant move into the era of #GreenSteel.
Ironically, UK Chancellor Rachel Reeves was on an official visit to China in January 2025 to drum up foreign direct investment (#FDI) from China into the UK. After this distasteful episode, it is not clear if such a wish might find a favorable echo from either side.