George Osborne urges Chinese firms to bid for HS2 rail contracts


George Osborne is kicking off the bidding process for the construction of the HS2 rail line, as he makes a pitch for Chinese companies to get involved in the high speed railway project as well as development schemes in northern UK cities.

Seven HS2 contracts, worth a total of £11.8 billion, cover bridges, tunnels and earthworks on the first phase of the controversial link between London, Birmingham and the North.

The milestone step - taken before the HS2 Bill has completed its passage through Parliament - was being announced by the Chancellor in the Chinese city of Chengdu during a five-day tour designed to strengthen Britain's economic links with the east Asian giant and win trade and investment for the UK.

Mr Osborne was also opening a pitch book on more than £24 billion of investment opportunities in the region he has dubbed the "Northern Powerhouse".

Chinese investors will be invited to get involved in infrastructure schemes including the Atlantic Gateway connecting the Port of Liverpool to the City of Manchester and a proposed Science Central development in Newcastle.

The HS2 announcement comes shortly after Mr Osborne took a trip on one of the many high-speed lines that have been laid around China in recent years, from Urumqi to Turpan in remote Xinjiang province.

"This Government is committed to rebalancing our economy and building a Northern Powerhouse, and improving transport links and launching HS2 is key to supporting long-term economic growth across the North and Midlands," the Chancellor said.

"That's why I'm here in China today opening the bidding process for construction contracts worth £11.8 billion, which will propel HS2 forward.

"We are truly entering a golden era of co-operation between our two countries, and it's crucial that businesses and communities from across the UK feel the full benefit of forging closer economic links with China."

Transport Secretary Patrick McLoughlin described the start of the civil engineering procurement process as "a major step towards construction on HS2 getting under way in two years' time and a massive opportunity to help rebalance our economy long before the trains start running in 2026".

HS2 Ltd chief executive Simon Kirby said the winners of the contracts would build 230km of bridges, tunnels and earthworks and create thousands of jobs over the next decade.

With the Chancellor in Chengdu were leaders of councils in Northern Powerhouse cities Liverpool, Sheffield, Leeds, Manchester and Newcastle, as well as Cheshire East and Trafford.

Projects for which they are seeking investors include the 10,000-home Manchester Place development, the new Sheffield Retail Quarter and the South Bank regeneration scheme in central Leeds.

Mr Osborne was also announcing the potential doubling of enterprise zones in the North; efforts to reinvigorate partnerships between northern and Chinese cities; a new Lancaster University service to bring together UK and Chinese universities, researchers and businesses; and a programme to teach Chinese radio astronomers at Jodrell Bank

Commercial Secretary to the Treasury Lord O'Neill said the initiative would give the UK an opportunity to learn from China's experience of urbanisation and the creation of "cluster cities" like Chongqing-Chengdu.

Communities Secretary Greg Clark said: "Today's pitch book sets out in black and white to Chinese investors over £24 billion worth of exciting investment opportunities, which together will deliver key infrastructure projects, help develop a highly skilled workforce and create thousands of jobs."

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