A NEW row has broken out over Nicola Sturgeon's deal with two Chinese companies after she was accused of discreetly cutting ties with the firms after concerns over human rights abuses and corruption emerged.
The Scottish Government signed a Moratorium of Understanding in March, paving the way for £10 billion of investment in Scottish infrastructure, without knowing that one of the companies is a wholly-owned subsidiary of a state-owned construction giant that had been blacklisted by Norway's oil fund on ethical grounds and tied to illegal forced evictions in Africa by Amnesty International, which subsequently flagged concerns to the First Minister.
It was revealed yesterday that ministers had taken part in no discussions with the companies, China Railway No. 3 Engineering Group (CR3) or Sinofortone, since May, although officials had participated in limited talks.
Read more: Sturgeon's £10bn deal with firm owned by "grossly corrupt" Chinese construction giant
It also emerged that the Scottish Government had made contact with Norway's finance ministry and received confirmation of the findings of a 2014 report which revealed an "unacceptable risk" that CR3's parent company, China Railway Group, was involved in "gross corruption".
Ms Sturgeon posed for photo with company representatives as she signed the MoU and previously sent them private letters, while officials were party to talks over funding models and even agreed to help with finding offices for the Chinese.
However, in response to parliamentary questions, John Swinney said that since May only a short teleconference had taken place between officials and representatives of the firms, at their request, in June, while an intermediary had also discussed the agreement in late July.
The apparent cooling in relations comes as the UK Government moves to review a move to hand the Chinese a significant role in the new Hinkley Point nuclear power station, amid fears in some quarters that the country's involvement would pose a security risk.
Willie Rennie, the Scottish Liberal Democrat leader, said: "The parliamentary answers reveal that ministers have not spoken to the company since questions were raised. 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 admit they made a big mistake and confirm that the memorandum of understanding is dead in the water."
The Scottish Government said the agreement is about "developing a working relationship to explore possible investment in Scotland" and emphasised that no deals for specific projects had been finalised.
Read more: First Minister hits back at critics of Chinese "secret deal"
Meanwhile, an SNP spokesman accused Mr Rennie of being "desperate to chase investment away from Scotland". He added: "The Lib Dems have repeatedly made clear that they don’t understand the basics of what a Memorandum of Understanding even is, while also being guilty of appalling hypocrisy after calling for closer trade links with China when they were in the coalition UK Government."
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