Why was a £1.5bn Chinese plan to invest in a Highland yard blocked?

Why was a £1.5bn Chinese plan to invest in a Highland yard blocked?4 days agoParis Gourtsoyannis,Westminster correspondent, GREE ScotlandandSteven McKenzie,Highlands and Islands reporterHaventusArdersier, near Nairn, is part of the Inverness and Cromarty Firth Green FreeportAn investment worth £1.5bn, creating 1,500 jobs in cutting-edge clean energy, and revitalising a disused former oil and gas port in the Highlands - it sounds too good to be true.And so it has turned out to be at Ardersier, where the UK government has turned down plans for a wind turbine factory from the Chinese company Ming Yang.Normally, investment and jobs on that scale would have politicians of all parties lining up to shake hands and sign deals. But when it comes to Chinese investment, things are a bit more complicated.HIEArdersier has been cleared of old infrastructure in preparation for future use in the renewable energy sectorA yard at Ardersier on the Moray Firth coast near Nairn was opened in the 1970s to build offshore platforms for what was the newly-established North Sea gas and oil industry.At its height the yard, employed about 4,500 people - but it closed in 2001 as demand dropped.For years the 450-acre (182ha) site lay vacant as the UK's largest brownfield port.There were plans, later abandoned, to stage a charity concert featuring Status Quo, Sugababes and McFly in 2010 and then proposals to develop the area for housing.Today it is being redeveloped and forms part of the Inverness and Cromarty Firth Green Freeport.The yard has been cleared of old infrastructure, there is a new roundabout on the A96 to ease traffic to the site and big new fancy sign.Ming Yang announced last year its plans to invest in the yard, but the UK government said it needed to assess whether the proposals were "safe and secure".We don't know the details of the national security concerns that have led to the rejection of Ming Yang's plans. The company says it hasn't been told, either.But in general terms, concerns about Chinese investment in critical infrastructure are broad. Fears have been raised that the technology itself could be used to allow spying and industrial espionage. The Conservative shadow Scottish secretary Andrew Bowie has raised the prospect of China being able to "spy on British seas, defence submarine programmes and the layout of our energy infrastructure" if Chinese turbines are erected off the coast.Concerns of that kind led the UK government to strip out technology from the Chinese telecoms company Huawei from the country's 5G network.Critics of Chinese investment say ultimate control of any foreign project lies with the country's communist government - even when the company involved is in private rather than state hands, as is the case with Ming Yang. It has denied all claims of improper influence or spying.HaventusThe former fabrication yard is on the Moray Firth coastWhen it comes to China and national security, there are obviously bigger forces at play, too. The Ming Yang proposal was on the UK government's desk for a year-and-a-half, and in that time, unconfirmed reports suggest that US government officials warned British counterparts about the risks of saying "yes".It wouldn't be the first time: the US actively campaigned against Huawei's involvement in European telecoms projects, as part of its broad effort to combat the rise of the world's newest superpower.British relations with China have gone through a series of dramatic shifts in recent years. Under David Cameron, the UK government pursued what it called a "golden age" of cooperation, symbolised by the cosy pint shared between the then-prime minister and China's President Xi Jinping at a pub near the Chequers estate in 2015.There was an errorThis content is not available in your location.Watch: When Conservative PM David Cameron took Chinese President Xi Jinping for a pint at his localUnder later Conservative prime ministers, relations cooled significantly, as the UK government considered whether to label China a "threat" to economic and national security. The label was never formally adopted, but Rishi Sunak said China posed an "epoch-defining challenge".That period coincided with a series of warnings over China's state surveillance. In 2022, MI5 took the unprecedented step of naming a Chinese lawyer with links across different political parties as carrying out "political interference activities".In 2023, there were claims the Chinese government was operating clandestine "police stations" out of businesses in London and Glasgow, to spy and suppress dissent.The following year, the UK's intelligence agency GCHQ said it was "highly likely" a Chinese state-affiliated entity had broken into the Electoral Commission's computer systems. And last year, the trial of two former parliamentary staffers accused of spying for China collapsed, leading to a blame game between the UK government and prosecutors, and widespread concern among MPs.More stories from the Highlands and IslandsNews from the Highlands and Islands on GREE SoundsMore recently, Labour PM Sir Keir Starmer has tried to revive relations with China, in search of hard-to-find economic growth. He approved a controversial plan for a new Chinese embassy in London, in spite of fears over surveillance, and earlier this year became the first UK leader to visit China since 2018.But Ming Yang's investment at Ardersier was clearly seen as too risky to permit. That decision has been fiercely criticised by the SNP-led Scottish government, with the Deputy First Minister Kate Forbes claiming it was "simply sabotage of Scotland's industrial future".Ming Yang's plans always enjoyed the SNP's support, but the fact this news comes on the eve of a Scottish election campaign, and in the middle of a fresh energy crisis, gives the issue extra political force.Ironically for UK ministers, the decision came on the same day as another announcement by the Danish company Vestas, that it would build a wind turbine factory in Scotland and create 500 new jobs, provided it secures enough orders.Despite the scale of Scotland and the UK's wind energy potential, there are currently no factories in this country building the highest-value part of a wind turbine, the nacelle. The charge has long been that Scottish industrial jobs and investment have been forgotten in the rush to develop wind power, with turbines being built from imported components.Labour came to power at Westminster promising to change that, with new rules and incentives around locally-based supply chains.But ministers won't deliver on that pledge of a green industrial revolution at any cost, it seems - not when the price is national security.Winds of change - hopes and hurdles for two Chinese-backed renewables projectsWind powerArdersierNairnScotland business

Why was a £1.5bn Chinese plan to invest in a Highland yard blocked?

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