With another UK steel plant apparently heading for administration, China's dumping of huge surpluses of subsidised steel on global markets could make for some awkward conversation as Britain rolls out the red carpet for visiting Chinese president, Xi Jinping. Ciara Lee reports.
A ceremonial welcome for Chinese leader Xi Jingping. With a number of investment deals expected to be announced this week, Britain is on course to cement its lucrative place as China's closest friend in the West. Projects range from nuclear power to the transformation of northern England. Johnny Hon is a commentator in Anglo-Chinese business relations. (SOUNDBITE) (English) DR JOHNNY HON, EXPERT COMMENTATOR ON ANGLO-CHINESE BUSINESS RELATIONS, SAYING: "The Chinese side, they have the capital, they want to invest. Also the northern powerhouse initiative from the UK government, cities like Manchester, Newcastle, Sunderland, they are household brands because of the football in China." But the courtship isn't pleasing everyone, not least Britain's steel workers. Caparo Industries looks set to file for administration, putting 1700 UK jobs at risk. And Tata steel may cut around 1200 jobs, just weeks after SSI went into liquidation with a loss of over 2000 jobs. Firms say plunging prices and cheap Chinese imports are to blame. CMC Markets analyst, Jasper Lawler. (SOUNDBITE) (English) CMC MARKETS ANALYST, JASPER LAWLER, SAYING: "They're able to produce things at a cheaper cost. But the sense is that maybe the price that they're selling steel at is not actually even obtainable with their costs. It is being subsidised, and that is really an act to destabilise industry in the UK and other countries and help build up their own industry until such time as they're strong enough to stand up on their own two feet." The four-day state visit is the culmination of a years-long charm offensive to show Britain "walking tall on the world stage". David Cameron says he will raise the steel issue during the visit - a few awkward moments could lie ahead.