China’s decision to invest in the UK’s nuclear sector is not a surprise, nor a reason for fear.
Energy analyst Tony Ward, Head of Power and Utilities at EY made the comments in light of yesterday’s huge deal signed by Chinese Premier Xi Jinping and David Cameron.
China will now own around a third of the Hinkley plant set to open in the next decade and the investment is just part of a bigger deal worth billions to the UK nuclear industry.
China is also investing heavily in other infrastructure projects and in general in the UK, however critics including some of the PM’s ex staff have said we should not be dealing with a nation with such a poor human rights record.
“I’m not saying we should be naive but it is important for us to deal with China,” said Mr Ward.
“China is the planet’s second largest economy, it is a significant provider of capital. I find it odd to think we wouldn’t engage with what is one of the biggest economies in the world. If we want global trade and projects like this to happen we need to engage with a range of different capital providers,” he added.
And when it came to fears about selling off the nation’s nuclear assets to a foreign power Mr Ward said China was just one of many nations involved.
“EDF and AREVA are French state owned. So I think there is a bit of misdirection towards the Chinese which tends to invoke a reaction.”
But if other nations are willing to invest in nuclear here, why isn’t the UK government willing to spend the money themselves?
“We have gone down the route where we won’t put in state level intervention. Successive governments have decided on this, it is a UK policy choice. So instead we put in frameworks to encourage third party capital to come and develop assets here.
“And to get these huge infrastructure projects running it’s often international consortia that we need and it’s soverign states who can provide the backing.”
EY today revealed a report showing how important investing in the energy sector is to the UK economy.