It was to be the centrepiece of a mini Shanghai on the Mersey

It was to be the centrepiece of a mini Shanghai on the Mersey. Now an international trade centre planned for the Wirral could be built on a suburban industrial estate behind Port Sunlight tennis club

The original ￡175m scheme was an attempt to harness Chinese investment and to underpin the ￡4.5bn Wirral Waters development of offices, homes and warehouses on 500 acres of redundant dockland

It would have housed 1,000 Chinese companies wanting to do business in the UK in a tax-friendly zone

Peel, the multibillion pound property group behind the plans, has ended a joint venture with its Chinese development partner Sam Wa “by mutual agreement” after several fruitless years attempting to recruit occupiers

It has switched its focus, it says, to potential investors from Korea, India and other fast-growing economies

But the Labour local council is pressing ahead regardless. It has agreed in private to sell a patch of former Ministry of Defence land in Birkenhead to Sam Wa, the Financial Times has learnt. The deal was approved by its cabinet on November 5, without public scrutiny as an “exempt item”

Wirral council said commercial confidentiality meant it could not discuss the deal publicly

The challenges of development in the area were made clear at the same meeting, where the council set up a ￡16.1m investment fund for Wirral Waters, saying it would borrow money against future business rates to kick-start construction

The council papers proposing the fund state that “there are a number of barriers to development, in particular that end values are far less than the actual cost of development”

Peel owns the bulk of the waterfront on the Mersey and is pressing on with the rest of Wirral Waters, although a college and office block are the only buildings to go up so far

England’s northern cities have been jostling for Chinese investment

He announced that Beijing Construction Engineering Group, a state-owned company, would invest in two large offices by the airport, which would cater to Chinese companies. The ￡130m plan is part of Manchester’s Airport City scheme

Sam Wa was founded and is chaired by Stella Shiu, who changed her name after being declared bankrupt by a Hong Kong court in 2008 for failure to repay a loan

The sale will proceed after due diligence on Sam Wa, the council said

This month it also agreed to delegate to its leader, Phil Davies, the power to approve asset sales up to ￡2.5m. The site being sold to Sam Wa was valued at ￡2m in 2013, according to a document seen by the FT

Mr Davies said: “Sam Wa, who at an earlier stage were going to be partnering with Peel, are now looking to invest all the money themselves.”

Phil Gilchrist, leader of the Liberal Democrats on the council, questioned the suitability of the site for a trade centre. He noted that it was “inland with no immediately accessible port facilities” and some distance from the M53

Sam Wa’s stated interests include electronics manufacturing, import and export, timber trading and a large mining concession in the Philippines

An FT investigation in 2013 found its home at the time was a cramped office belonging to an organisation called “Shanghai Enterprise Top 100 Association”

Sam Wa’s headquarters in Beijing was a closely guarded military hotel that did not allow outsiders to enter