Scotland politics

Concern over corruption claims of China firm seeking Scotland investment

Nicola Sturgeon signing deal Image copyright Sinofortone
Image caption The agreement was signed at the first minister's official residence, Bute House in Edinburgh, on 21 March

Scottish Liberal Democrat leader Willie Rennie expressed concern at reports of a Chinese company seeking to invest in Scotland being linked with corruption.

His comments came after it emerged Norway blacklisted China Railway Group.

One of the group's subsidiaries has signed an agreement with Scottish ministers which both sides hope would lead to £10bn in investment.

First Minister Nicola Sturgeon stressed that any proposed investment would be fully scrutinised.

Labour and the Conservatives have also expressed concern.

On 21 March, Ms Sturgeon and a Chinese consortium signed a "memorandum of understanding" to explore an investment agreement potentially worth £10bn - although details of the move have only just emerged.

One of the signatories was investment group SinoFortone, while the other was China Railway No. 3 Engineering Group, listed as a subsidiary of China Railway Group Limited by the China Chamber of Commerce for Import and Export of Machinery and Electronic Products.

In 2014, the ethics council of the Norwegian pension fund warned there was an "unacceptable risk" that China Railway Group was involved in "gross corruption".

It added there was a "high degree of probability" the company "paid bribes to government officials for contracts regarding construction of railways and housing projects" in China.

Huge questions to answer

Mr Rennie said: "I'm very worried about it because the Norwegian oil fund has made a decision, an assessment on one of the companies involved in the memorandum of understanding.

"They don't think they're a company worth investing in or being associated with.

"I don't understand how the Scottish government could have done their appropriate due diligence and come to a different conclusion."

Scottish Conservative leader Ruth Davidson, added: "I think the worrying thing for people out there is that we're having a drip of information on this China deal and it's all coming from China.

"Why don't we know about this from the Scottish end? What is it that the Scottish government didn't want to tell us?

"There are huge questions still for the Scottish government to answer."

'Memorandum of understanding'

Kezia Dugdale, the Scottish Labour leader, said: "Nicola Sturgeon and the SNP government didn't want us to know they'd signed a £10bn deal with China for potential investment in Scottish public services, and we need to know the details of this deal."

However Ms Sturgeon, who is leader of the SNP, said: "There is no agreement from China Railway to invest in any projects in Scotland.

"What we have is a memorandum of understanding to explore opportunities.

"If there is in the future any proposal for an actual investment, then full due diligence would be done in the normal way by the Scottish government and it would be subject to the full scrutiny of the Scottish Parliament."

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