British taxpayers are underwriting a multi-million-pound loan to help China plant trees as part of a project to tackle climate change.
The Treasury has agreed to a European Union scheme to help the country grow forests to compensate for its contribution to global warming.
The Luxembourg-based European Investment Bank – of which the Chancellor is a governor – has lent China £210million (250million euros) to kickstart the project.
Britain has agreed to underwrite the loan, covering 16p in every pound that is not paid back should the debt turn toxic – which would cost us more than £30million.
While EU member states – which are the EIB’s shareholders – are mired in trillions of pounds of debt and sluggish growth, China is now the second largest economy in the world and continues to expand by 2 per cent a year.
India and Brazil are among other countries with surging economies to receive similar EU anti-climate change loans in the past 12 months.
Since last year, the deals have seen the UK taxpayer loaded with an extra £920million of liabilities.
The British government has announced plans to stop sending aid to China. But, through the EIB, we will still be underwriting loans to the country for years to come.
Last night, critics expressed amazement that the UK was helping China plant trees – saying the move could harm our economy.
Philip Davies, Tory MP for Shipley, said: ‘As a result of ridiculous climate change policies at home, we are seeing industries relocating to China because energy here is becoming so expensive.