Keith Brown 'sorry' over Chinese investment flop

Written by Tom Freeman on 30 March 2017 in News

Cabinet Secretary Keith Brown apologies for secret financial memo with two Chinese companies, one of which was a shell company

Keith Brown - Scottish Parliament

Scottish Economy Secretary Keith Brown has apologised to MSPs for a 2016 investment pact with two Chinese firms which subsequently collapsed.
 
Brown said he took "full responsibility" for the £10bn deal signed by First Minister Nicola Sturgeon with SinoFortone and China Railway No.3 Engineering Group in March 2016.
 
The deal collapsed after opposition parties raised concerns about the agreement.


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China Railway Group had been named in an Amnesty international report on human rights abuses and SinoFortone Group was revealed as a shell company with only one British asset, a £2m pub in the Chilterns.
The Scottish Government insisted no legal or financial commitments were made in the memorandum of understanding.
 
The Liberal Democrats yesterday brought the issue to a debate in Holyrood seeking formal censure for the Scottish Government over the deal.
 
Leader Willie Rennie said ministers were "naive to lend any credibility to that enterprise" and that it "shows how careless the First Minister was to put pen to paper on a deal with Chinese companies that she knew absolutely nothing about."
 
Formal censure was avoided after the minister apologised.

"I take full responsibility for the handling of the MOU, and I am sorry for the issues that have arisen from it," said Brown.

"I can assure Parliament that we have learned and will learn lessons from the experience of the MOU. We will consider human rights issues in our engagement with overseas businesses and we will sign investment agreements only where appropriate due diligence, including on the human rights record of companies involved, has been undertaken."
 
Speaking after the debate, Rennie said: “I welcome the first real acknowledgement from the Cabinet Secretary that this was badly handled but we now need to properly see how we avoid this shambles happening again. Never again should we learn about an investment deal in the Chinese press. Never again should human rights and gross corruption be ignored. Opposition parties were attacked for raising legitimate concerns.
 
“It shouldn’t have taken all this effort to get an apology. Now he needs to show that he has actually learnt from this debacle.”
 
Scottish Green co-convener Partick Harvie, who had pushed for the apology throughout the debate, said: “This debate raised serious issues about just how compatible human rights is with trade.  Human rights cannot be an afterthought. In dealings with countries such as China, Saudi Arabia - and perhaps increasingly in the future the US - issues of human rights and ethical business must be central to the discussion. The government is due criticism for failing to do that.

“Others seemed more interested in trying to claim a ministerial scalp than addressing the issue of human rights. Today I pressed for an apology from Keith Brown and one was given, showing he has understood the strength of feeling on this issue."

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