China’s energy ambitions crushed within weeks
China’s infrastructure investors were looking to invest billions into nuclear power and electricity distribution, but this week roughly $15 billion worth of deals have fallen through. With the UK’s halt on Hinkley Point C, which China were investing huge amounts into and plugs being pulled on various longstanding Australian opportunities, it seems that China’s hopes for its energy investment have been crushed before they even lifted off.
“As China’s diplomatic policies become more and more assertive, there’s a trend that these countries are gradually enhancing their vetting on Chinese investment,” said Tao Jingzhou, a managing partner at Dechert LLP in Beijing. “This is an attitude change.”
“The more assertive a country makes its foreign policy, the harder it will be for partners like Australia to accept its foreign investment,” said Peter Jennings, executive director of the Australian Strategic Policy Institute. “It is a difficult message for China to receive, but a necessary one.”
This wariness between the UK and Australian governments about Chinese investment could have a knock-on effect on future investment. China has been reclaiming reefs in the South China Sea, but in doing so were exceeding the law. This also increased uncertainty around working with the country. Australia and the U.S. were among the nations encouraging China to accept this and discontinue the operation.
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