Steel dumping not on agenda as Theresa May meets Xi Jinping

Theresa May did not raise concerns about Chinese overproduction of steel, which has been blamed for crippling the British steel industry, in her first meeting with China’s president, Xi Jinping, on Monday.

During a half-hour bilateral, the prime minister avoided the controversial subject that overshadowed Xi’s visit to the UK last year at a time when the industry was in crisis. Thousands of workers at Port Talbot and other plants are still facing an uncertain future.

An official source insisted the issue was being dealt with at G20 level and progress was being made. There was, however, immediate criticism of May from the Liberal Democrats for her decision not to raise it with Xi.

The source said it was a good meeting between May and Xi, who did not protest about her decision to review Chinese investment in a UK nuclear energy project.

There was only an oblique reference to Hinkley Point, the Chinese-backed nuclear project under review, as Xi told May he was willing to be patient about the government’s decisions in major projects.

The official source said the UK was pleased that China had brought up the prospect of exploring a bilateral trade agreement after Brexit.

“We are pleased it was a warm bilateral that Xi wrapped up by saying it was a very good beginning and they specifically said China would be open to a bilateral trade arrangement. That is interesting to us as we leave the European Union,” the official source said.

China is one of six countries at the G20 that have expressed interest in bilateral trade talks, although the US and Japan are among those that raised concerns about the consequences of Brexit on trade and investment.

However, following the session with Xi, May is likely to face criticism from those fighting to save UK steelmaking for her decision not to mention concerns about Chinese dumping of cheap steel on the world market.“It wasn’t an issue that came up. We addressed that sort of area in the G20 in broader discussions and this was an opportunity to talk more about bilateral economic and trading relationships,” the official source said.

In contrast, Jean-Claude Juncker, the European commission president, used the G20 summit to call for tougher monitoring measures in China to deal with steel overcapacity, which has plunged the industry into crisis in parts of Europe including the UK.

“This is a global problem, but with a specific Chinese dimension we have to address,” Juncker said at a press conference. “We are really insisting on the need to take this seriously.”

At the G20 summit in Hangzhou, the world leaders pledged to create a global steel forum to address excess capacity.

China has promised to cut production but is behind on its target and there is still a long way to go to reduce more of the 700m tonnes of excess capacity.

The omission does not appear to have been an accident as a UK official said before the meeting that it was not certain to be be brought up, as May believes there has already been some progress in cutting overproduction at the G20 level.

David Cameron was last year criticised for failing to raise the issue strongly enough during Xi’s state visit and for not responding quickly enough to the threat to jobs in the UK steel industry.

However, the subject did not appear to be a top priority for May despite her commitment to a more active industrial policy.The official source said it was being dealt with at G20 level and progress is being made. “The reason why every country has signed up to this approach is that there are countries, including China, which have excess production that they are dealing with,” the source said.

“If you look at the measures the Chinese have taken to reduce their capacity, they are dealing with hundreds of thousands of job losses in China because of their own excess capacity. It is a factor that flows out of the downturn in the global economy post the crash, which now means it is an issue the G20 is having to deal with.

“We have already made progress in a wider forum. It is their first bilateral … and from our perspective we have made important progress here in getting acknowledgement at the G20 level.”

However, Lorely Burt, the Lib Dem business spokeswoman, said it was “disgraceful that Theresa May failed to raise the issue of steel exports with the Chinese”.

“Thousands of jobs at Port Talbot and across our steel industry are facing an uncertain future thanks to the dumping of steel on the EU market by China,” she said. “It was the Conservative government who blocked EU plans to stop this practice, but now we are leaving the EU our new prime minister doesn’t even think it’s worth mentioning.

“It’s not good enough to allow Brexit to reduce our place in the world to silently sitting wishing someone will offer us a trade deal, like a nervous teenager waiting to dance at a school disco. We need a prime minister willing to fight for British industry and to make the case that the UK remains open, tolerant and united.”

The Guardian