The plan by France's EDF to build two reactors with financial backing from a Chinese state-owned company, China General Nuclear Power Corp, was championed by Prime Minister Theresa May's predecessor, David Cameron, as a sign of Britain's openness to foreign investment.
But just hours before a signing ceremony was due to take place on Friday, May's new government said it would review the project again, raising concern that Britain's approach to infrastructure deals, energy supply and foreign investment may be changing.
May was concerned about the security implications of a planned Chinese investment in the Hinkley Point nuclear plant and intervened to delay the project, a former colleague and a source said on Saturday.
In a statement sent to Reuters, Chinese Foreign Ministry spokeswoman Hua Chunying said they had ‘noted’ the decision.
‘I would like to stress that this project was agreed upon by China, Britain and France in the spirit of mutual benefit and cooperation, and win-win cooperation, and has always had the strong support of Britain and France,’ Hua said.
China ‘hopes that Britain can reach a decision as soon as possible, to ensure the project's smooth implementation’, she added, without elaborating.
Britain and EDF first reached a broad commercial agreement on the project in 2013. China got involved two years later when Downing Street laid on a state visit for President Xi Jinping, designed to cement a ‘Golden Era’ of relations between the two countries.
China General Nuclear Power, which would hold a stake of about a third in the project, said on Saturday it respected the decision of the new British government to take the time needed to familiarise itself with the programme.
But China's official Xinhua news agency, in an English-language commentary, took a stronger line.
While China understood and respected Britain's requirement for more time to think about the deal, China would not tolerate ‘unwanted accusations’ about its investments in Britain, a country that cannot risk driving away other Chinese investors as it looks for post-Brexit trade deals.
‘What China cannot understand is the 'suspicious approach' that comes from nowhere to Chinese investment in making the postponement,’ it said.
The project would create thousands of jobs and generate much needed energy following the closure of coal-fired power plants, Xinhua added, dismissing fears China would put ‘back-doors’ into the project.
‘For a kingdom striving to pull itself out of the Brexit aftermath, openness is the key way out,’ it said.
‘If history offers any guide, many China-targeted suspicions have been boiled down to diffidence and distortion. China can wait for a rational British government to make responsible decisions, but can not tolerate any unwanted accusation against its sincere and benign willingness for win-win cooperation.’
Such commentaries are not government statements, but offer a reflection of official thinking.
Xinhua said people might think Britain was trying to erect a wall of protectionism.
This ‘will surely stain its credibility as an open economy and might deter possible investors from China and other parts of the world in the future’, it added.