Following the British government’s forced postponement of the final investment decision on Hinkley Point, Peter Mandelson has impressed the importance of pressing on with the project.
It is believed that a strong motivation behind the delay was based around concerns related to the Chinese investment behind a third of the project. Indeed Theresa May’s chief of staff said last year that May, along with various other “security experts – reportedly inside as well as outside government – are worried that the Chinese could use their role to build weaknesses into computer systems which will allow them to shut down Britain’s energy production at will”.
Mandelson dismissed the security service’s concerns (though argued that he did not necessarily blame them for reaching the conclusions they did), claiming that it would simply not be in China’s interest to compromise British national security in such a way.
He said: “The government has to consider China’s motivation for wanting to finance projects like this and, in my view and I guess in their view too, they judge that it would be commercial global suicide for China if they were to invest on the one hand and then try to mess around with other countries security on the next.
“I mean, nobody would trust China ever again; nobody would want to do business with Chinese investors ever again. The truth is that China would have far, far too much to lose if it were to start compromising other countries’ national security.”
He also warned that delaying the project based on such suspicion would risk jeopardising British-Chinese relations, something that we cannot necessarily afford to do at the moment.
China’s UK ambassador, Liu Xiaoming, wrote an article in the Financial Times following the announcement of the delay, raising this issue of the importance of ‘bi-lateral trust’.
“If Britain’s openness is a condition for bilateral co-operation, then mutual trust is the very foundation on which this is built,” he said.
“Right now, the China-UK relationship is at a crucial historical juncture. Mutual trust should be treasured even more. I hope the UK will keep its door open to China and that the British government will continue to support Hinkley Point – and come to a decision as soon as possible so that the project can proceed smoothly.”
Mandelson argued that, right now, following the vote to leave the European Union, Britain must not risk damaging relationships with other countries like China with whom we should be trying to maintain trade.
“We are in a slightly invidious position in trade vis-a-vis China,” Mandelson said, “despite the size of our market we are probably less relevant to China out of the European Union because we would be unable to influence that huge bloc’s future trade policies anymore and out of the EU we are probably more dependent on China’s goodwill because we will need to replace trade lost in Europe.
“So we are not in the happiest of positions, but this is the reality and we have got to adopt a pragmatic approach to this. We can’t be too fussy about who we do trade with, whilst at the same time trying not to be a pushover and become supplicants in world trade.”
Despite Mandelson’s comments, and general concerns that delays were brought about due to caution over China’s involvement in the project, a spokesperson for the government has assured that postponement was more to do with general issues with an infrastructure project the size of Hinkley.
They said: “As we’ve already made clear, this decision is about a huge infrastructure project and it’s right that the new government carefully considers it.
“We cooperate with China on a broad range of areas from the global economy to international issues and we will continue to seek a strong relationship with China.”