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Theresa May Welcomes £1.7bn Chinese Project in London’s Docklands

Royal Albert Dock development plan. Royal Albert Dock development plan. Photo: ABP

Britain’s relationship with China is still “golden”, the prime minister said as she welcomed a Chinese developer’s plans to build a £1.7bn business district in east London.

Theresa May, who held talks with Ma Kai, China’s vice-premier, in Downing Street on Wednesday (11/9) night, is keen to show Britain remains open to investment from China.

The warm ties fostered by George Osborne, the former chancellor, cooled after Mrs. May decided to review investment by a Chinese energy company into the Hinkley Point nuclear power project.

Jim O’Neill, the Treasury minister leading trade talks with Beijing, quit the government after he was sidelined over the issue.

It has not been clear whether Mrs. May’s government would continue to invest as much political capital in the relationship, not least because of her focus on security issues.

But her eventual decision to back the Hinkley project — with some new security safeguards — eased the tensions ahead of her meeting with the Chinese vice-premier, who will meet Philip Hammond, chancellor, on Thursday (11/10).

“As we take the next step in this golden era of relations between the UK and China, I’m excited about the opportunities for expanding trade and investment between our two countries,” Mrs. May said.

As part of the visit, ABP, the developer leading the project at Royal Albert Dock, will sign a funding agreement to enable work to begin on the delayed scheme next year.

ABP said it would proceed with the plans, supported by Boris Johnson, the former London mayor, despite the Brexit vote and hitches including the withdrawal of a big investor, in what it said was a “mark of faith in the UK market”.

The group, which will announce a new development partner in Thailand’s Charoen Pokphand Group, has pledged £425m of the costs, in addition to Citic, the Chinese conglomerate, which is an investor and lead contractor.

The development stalled when China Minsheng Investment Group pulled out after failing to agree an equity split with ABP. This raised doubts about the scheme despite at least three previous signing ceremonies. Work will begin on the first of six phases early next year, ABP said.

Four Chinese banks will provide £1.2bn of funding for the 35-acre scheme close to London City Airport and the new Crossrail line. The scheme is one of several Chinese-backed developments under way in London, in a wave of Asian investment into the city’s real estate.

Others include The Spire, a 67-storey residential tower in east London, and the Ram Brewery project in Wandsworth to be built by Shanghai’s Greenland Group, and the Wanda One hotel and residential project south of the Thames by Dalian Wanda, the world’s largest property developer.

Lord O’Neill, the former Goldman Sachs chief economist, feared that Mrs May would sideline the China relationship and the Northern Powerhouse, another of his projects, and left the government in September.

Although the Chinese delegation will not visit the north on this visit, Mr. Hammond will unveil a “Northern Powerhouse investment portfolio” detailing 13 large-scale property and infrastructure projects. They include investment to help double the size of MediaCity in Salford and a regeneration project in Doncaster.

By Courtesy of FT

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