Sun, December 18, 2011
China > China & World

Chinese tycoon pitches Iceland deal once again

2011-12-18 10:09:31 GMT2011-12-18 18:09:31(Beijing Time)  Global Times

A Chinese tycoon has revived his plan to buy a swathe of property in Iceland just weeks after the country rejected his land purchase bid, the Financial Times reported.

Representatives of Huang Nubo's company, Beijing Zhongkun Investment Group, had a meeting with officials from Iceland's Ministry of Industry, Energy and Tourism on Thursday, to discuss the possibility of adjusting the deal structure.

"I might go to Iceland to discuss the deal next Monday and I am optimistic about it," Huang told the Global Times.

Yao Chen, Huang's secretary, told the Global Times on Friday representatives are looking for a new way to close the deal.

According to Yao, they will reclassify the purchase and report it to another department in Iceland's government for a better chance of being approved. The deal to purchase the 300-square-kilometer Grimsstadir farm in northeast Iceland for about one billion Iceland krona ($8.3 million) was turned down by Iceland's Interior Ministry.

On November 25, Iceland's Interior Ministry said the deal did not meet legal requirements for land sales to companies outside the European Economic Zone, including one requiring company directors to be Icelandic citizens or permanent residents for at least five years. It also says 80 percent of the shares in the purchasing firm must be held by Icelandic citizens.

Iceland's laws "imposes strict conditions on corporations wishing to acquire ownership or the right to use Icelandic properties, and it is clear the company in question doesn't fulfill any of the requirements," the ministry said.

Huang said he was shocked by the decision during a previous interview made by the Global Times. Despite the law, he said that the Interior Ministry's rejection was based on prejudice and warned of growing trade protectionism and invisible trade barriers for Chinese in the West.

"Some other departments are welcoming Huang's investment in Iceland," said Yao. "Iceland's Ministry of Industry has contacted Huang and said they want to re-open the discussion about the purchase."

Yao said some other northern European countries, including Denmark, Sweden and Finland are trying to make deals with Huang.

"Huang's case shows hostile thinking towards China still affects certain politicians while many others are changing their minds. After all, it takes time for Chinese companies going overseas to adapt to the challenges of global competition," Yu Hai, a professor from the Northern Europe Studies Center at Fudan University, told the Global Times.

Huang's proposal, under which he sought to buy land in Iceland to develop a high-end nature resort, sparked a heated debate in the country over the role of foreign investment. In China, it has come to be seen as epitomizing the prejudice that Chinese investors are thought to face abroad.

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