Questions asked about ‘£10bn Scotland-China deal’

Opposition party leaders are asking why an agreement signed two weeks ago between Scotland and China that could lead to £10 billion of infrastructure investments was not immediately made public by the Scottish Government.

First Minister Nicola Sturgeon signed a memorandum of understanding with Chinese investment group SinoFortone and China Railway No. 3 Engineering Group, the largest construction company in the world, on March 21.

That was before the official purdah period for the upcoming Scottish Parliament elections on May 5 — but the deal was not made public at the time.

SinoFortone said on its website: “Scotland will work with Chinese partners to bring about infrastructure projects with a potential value of £10 billion following the signing of an agreement by First Minister Nicola Sturgeon.”

SinoFortone said the agreement “will pave the way for significant investment in areas such as clean energy, transport and affordable housing.”

Sturgeon was met at Bute House by Dr Peter Zhang, managing director for SinoFortone Group, Sir Richard Heygate, senior advisor for  China Railway No.3 Engineering Group, and consul general Pan Xinchun.

No announcement was made at the time by the Scottish Government, but the SinoFortone website quoted Sturgeon as saying: “The Scottish Government has continuously made the case that Scotland is open for business and we have an economy that is rife with investment opportunities.

“We have been co-operating and engaging with China since 2007 and I further progressed Scotland’s business credentials during my trip last year, and this Memorandum of Understanding will strengthen our economic links with China in a number of areas.

“New innovation collaborations between Scotland and China can deliver a boost in business growth for both countries and deliver benefits to Scotland as a whole.

“We have high hopes for Scotland’s economy and it is in a strong position, but if we can drive further growth by looking beyond our shores and building relationships with firms across the world then we will seek to make that happen.”

The Scottish Government eventually posted the memorandum of understanding on its website in the past day:

The SinoFortone website published a joint statement from Zhang and Heygate: “We are delighted to act as a bridge between Chinese infrastructure expertise and finance with Scotland, to provide a real example of the benefits of the ‘One Belt One Road’ strategy in action.

“We believe that the enthusiasm that we have found amongst our many Scottish friends for the project guarantees its success.”

Consul General Pan Xinchun said: “I congratulate all sides on this agreement as this project will benefit not only Chinese enterprises but also the Scottish people.

“This agreement will strengthen our co-operation in sectors such as clean energy, transport and housing, and follows the First Minister’s successful trip to China last year where she said would explore further areas of co-operation between Scotland and China.

“As Consul General, I am happy to see relations between our countries go from strength to strength, particularly in trade as due to China having one of the world’s largest economies it has advantages in a number of areas, and with the right support I am confident this package will be delivered.”

The SinoFortone website also quoted Stagecoach founder Sir Brian Souter from Souter Investments as saying: “It is a very positive step for Scotland to attract investment of this nature.

“SinoFortone’s investment will be good for our economy, create jobs and enable growth.

“We look forward to hearing more about the specific projects and infrastructure that they are aiming to invest in.”

The Scottish Liberal Democrats told the BBC it was extraordinary that a deal of such magnitude had been “kept private” by the SNP.

The Scottish Conservatives claimed SNP ministers had tried to “hide” the agreement until after the election.

And Scottish Labour called for a guarantee that any future contracts with companies from China would not oblige Scotland to use steel from China.

A spokeswoman for Sturgeon told the BBC: “The first minister is more than happy for this information to be in the public domain which shows that once again opposition parties are ignoring reality to make up their own version of events — a move which has backfired badly.

“As the memorandum of understanding which the Scottish government has published clearly shows, it is an agreement to have preliminary talks about potential opportunities for investment to support jobs and economic growth in Scotland.

“It does not relate to any specific projects or specific amount of investment, is not a binding legal agreement and does not commit any public funds.”