Government officials '˜met Chinese investor after rights abuse warning'

Deputy First Minister John Swinney. Picture: John Devlin

Opponents have urged the First Minister to suspend a joint-investment agreement she signed in March with China Railway No.3 (CR3) after allegations about its parent company emerged.

On May 19, Amnesty International sent Ms Sturgeon its report into “human rights abuses” by another China Railway Group (CRG) subsidiary in Congo and highlighted Norwegian government concerns about “gross corruption”.

Ms Sturgeon responded on June 12 confirming she was not aware of the allegations when she signed the memorandum of understanding (MoU), but said “both reports will be considered as part of the full due diligence that will take place” if any investments are confirmed.

Deputy First Minister John Swinney said ministers have not held any discussions with CR3 since May 5.

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However, he said senior officials spoke to a CR3 representative about “potential investment opportunities” on June 30 and were told the agreement could still “deliver benefits for Scotland” by a key mediator on July 29.

In a written answer to parliament, Mr Swinney said: “Scottish Government officials participated in a short teleconference with the chair of the Asia Scotland Institute, Roddy Gow, and Sir Richard Heygate of (CR3 partner) SinoFortone on June 30.

“SinoFortone highlighted their conversations with third parties about potential investment opportunities. No other issues were discussed and a minute of the teleconference was not taken.

“Officials met with (Mr Gow) on July 29. The MoU was discussed along with a range of issues relating to Scotland’s relationship with Asia.”

The meeting was attended by Scottish Government officials Richard Rollison, head of international trade and investment policy, and Mark Boyce, head of international relations.

A minute states: “Roddy Gow noted that he had introduced Sir Richard Heygate and Dr Peter Zhang of SinoFortone to the First Minister in good faith and that despite the media coverage he was still of the view that the MoU could deliver benefits for Scotland.”

Mr Swinney stressed that “respect for human rights and the rule of law” is one of the guiding principles of the Scottish Government China strategy.

He pointed out CR3 is one of 46 subsidiaries of CRG and said the Amnesty report related to a separate mining subsidiary in Congo.

Mr Swinney said there “is no reference to CR3” in the council on ethics for the Norwegian government pension fund report containing allegations of “gross corruption” at CRG.

He also noted CR3 is not ineligible for financed contracts at The World Bank, which disqualifies companies that have been sanctioned for fraud and corruption.

Scottish Liberal Democrat leader Willie Rennie, who obtained the information in questions to parliament, said: “This new information shows that bungling SNP ministers were just weeks away from trashing Scotland’s reputation for a few Chinese Yuan.

“They signed a deal with a Chinese company without asking basic questions and only moved to cut ties once the Liberal Democrats, Amnesty International and others rang the alarm bell.

“The parliamentary answers reveal that ministers have not spoken to the company since questions were raised.

“The public information also shows that ministers only recently bothered to ask the Norwegian oil fund and Amnesty International what they knew about CR3’s ties to corruption and human rights abuses.

“This is an staggering level of incompetence. Ministers asked few questions before signing a multi-billion pound agreement. It now looks like they scrabbled to cut ties when they were faced with the truth.

“The SNP need to be up front with Scots, admit they made a big mistake and confirm that the memorandum of understanding is dead in the water.”

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