(July 17): The UK government’s nationalisation of British Steel “severely” undermines Chinese companies’ confidence in investing in the country, Beijing said, as it vowed to take “strong” measures to defend its firms’ interests.

“China firmly opposes and strongly deplores the decisions made by the UK government,” an unnamed spokesperson for the Ministry of Commerce said in a statement on Friday.

Britain’s Labour government said on Thursday it will take the loss-making steelmaker into full public ownership, more than a year after seizing de facto control of the company — which was losing more than £1 million (RM5.5 million) a day — to keep its two blast furnaces running. British Steel had been owned by Jingye Group, a Chinese conglomerate, since 2020.

Jingye injected large amounts of capital into the steelmaker to sustain its operations and preserve jobs, the spokesperson said. The ministry accused the UK of acting “under the pretext of national security” and seriously infringing on the company’s legitimate rights and interests.

The statement signals Beijing’s growing discontent with the UK’s treatment of Chinese companies. The British government has stepped up scrutiny of acquisitions under its national security legislation and has intervened in several deals involving Chinese buyers. 

After meeting his British counterpart last month, China’s Foreign Minister Wang Yi specifically urged the UK to set out a path for more Chinese investment. That followed London’s decision in March to block a Chinese turbine maker’s plan to build a factory in Scotland.

Tensions have persisted even after outgoing Prime Minister Keir Starmer travelled to China earlier this year, a trip designed to thaw relations that froze over issues including alleged human rights abuses and spying, accusations Beijing has denied. 

At the time of the April 2025 seizure, Beijing’s reaction was comparatively muted, and Starmer was still warmly received in January. His government was criticised by UK politicians wary of Beijing’s influence earlier this year for approving a huge new embassy in central London.

The Commerce Ministry called on the UK government to treat Chinese companies operating in the country “fairly and impartially”. It will closely follow further developments in the case and support Chinese companies in protecting their rights with legal means, the spokesperson said, without specifying what measures Beijing might take.

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