Scottish Corruption Scandal Shows Secret Dealings With China

08.11.2016 • Politics and War

From Merryn Somerset Webb – Merryn’s Blog (Great Britain) –

You have probably been very busy worrying about the US election and about Brexit. So my guess is that you may not have been paying much attention to local politics. Neither have I. So I have only just had a proper look at the total, total debacle that is Scotland’s conversations with China.

Back in March, Nicola Sturgeon entered into a memorandum of understanding with two huge Chinese companies – SinoFortone and China Railway No 3 Engineering Group (CR3) – with a view to developing a relationship that would leave to a programme of investment into “Scottish priority projects and infrastructure”. Unfortunately she didn’t tell very many people about it (there was an election about). Instead, as The Scotsman tells it, the deal only came to light after details of it were published in the Chinese press.

This led to a perfectly reasonable outcry from the opposition, who rather felt that this is the kind of thing that should come with transparency attached – particularly given that CR3 came with an “unacceptable risk that the company is involved in gross corruption” and has been blacklisted by Norway’s sovereign wealth fund as a result. Transparency International intervened. Amnesty International objected on the basis that “human rights should not be traded for economic gain.” And Labour called it a “backroom deal” that raises (hardly new) questions about the “transparency and competence” of SNP ministers. Which it was.

Either way, the whole thing didn’t last long. It turns out, says the Sunday Times, that the two Chinese companies withdrew from the arrangement back in August – or, as the SNP now puts it (true to form they didn’t mention it at the time), the companies “consider the MOU to be cancelled.” Why? An insider tells the paper that the political fallout from the deal was received “very badly” in China. They didn’t want to be involved in what was fast becoming a “Scottish shambles”.

This has been received badly by the SNP (which is presumably why it didn’t mention it at the time). So it is doing the obvious thing: blaming everything on everyone else. The opposition “should be ashamed of themselves” for losing Scotland all this potential investment, said a spokesman. They should stop “doing Scotland down” and work harder to make sure that everyone knows “Scotland is open for business.”

This is pretty hypocritical stuff. After all, the whole sorry incident has left the impression that Scotland is less a modern open economy than a secretive little place that actively discourages open debate. If the Scottish government really wants to reverse this view it has work to do.

It could start by shutting up about a second referendum and stop conflating Brexit with that second referendum: at a meeting of the Institute of Directors Scotland this week, 58% of members polled said that they believe their “prospects have been damaged by the SNP’s approach to Brexit” says the Times; 52% also said that Scotland’s “policy framework does not support economic growth” (another 10% were not sure on this one).

It’s damning stuff – and perhaps something Sturgeon might like to focus on for a bit before she does any more secret deals with morally iffy Chinese construction giants.

-Read more at moneyweek.com –

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