UK lawmakers urge China strategy as trade and security risks grow

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UK lawmakers urge China strategy

Highlights

UK government lacks a strategic, consistent China policy for 2024, leaving British firms unable to capture opportunities or manage escalating risks.
Committee cites reactive policy decisions, including blocking Ming Yang's £1.5 billion Scottish wind project and British Steel's emergency takeover, as evidence of trade and security inconsistency.
MPs urge new trade defences such as EV tariffs and sector 'red zones', warning EU protections could exclude UK firms from key export markets as China pursues global dominance in green tech.

Committee findings and policy gaps

As reported by The Guardian, citing the Commons business, innovation, science and trade select committee, MPs say the government still has not delivered the strategic, long-term and consistent China policy it promised in 2024. The report argues that the current approach leaves the UK unable to fully capture commercial opportunities for British companies while also failing to control growing exposure to poorly quantified risks in relations with China.

Liam Byrne, the Labour MP who chairs the committee, says businesses cannot plan for the future when ministers are improvising policy. He warns the UK is missing opportunities, leaving risks unmanaged and delaying key decisions until late in the process.

The committee says Britain must shape its own relationship with China or risk having that relationship determined in Washington or Beijing. MPs add that British companies continue to run profitable operations in China and want to expand there, while consumers benefit from lower-cost imports, including electric vehicles, at a time of pressure on household incomes.

Trade defences and pressure from Europe

The report points to a series of reactive decisions, including the March move to block Chinese company Ming Yang from building a 1.5 billion pound wind energy plant in Scotland after years of negotiations over unspecified security concerns. It also cites the emergency takeover of British Steel from its Chinese owners as evidence of what it calls inconsistency and opacity in policy.

MPs recommend drawing up new trade remedies to counter unfair competition, including possible tariffs on electric vehicles, and creating a red zone for sectors that would be closed to Chinese investment alongside a green zone where trade would be encouraged. Byrne says that is increasingly urgent as the EU tightens its trade stance toward Beijing and becomes more cautious toward the U.S.

The committee warns that new European protections could leave Britain outside EU trade barriers and cut firms off from their biggest export market. Byrne says the government should be ready to consider dynamic alignment with the EU, including tariffs on EVs, if that is needed to secure British industry a place in Europe's manufacturing plans and reduce exposure to Chinese dominance in strategic green technologies.

The EU has already imposed tariffs on Chinese EVs, limited hybrid car imports from China and is considering stronger emergency tools if Beijing uses trade as leverage. The report says those moves matter for the UK as China remains on course to exceed last year's record 1.19 trillion dollar global trade surplus, while its 2026 to 2030 five-year plan prioritises further expansion in EVs, batteries, wind turbines, hydrogen and solar panels.

In our earlier article on Mario Draghi’s warning about the policy squeeze between debt control, inflation fighting and long-term growth, we outlined his argument that keeping rates too restrictive for too long can raise debt pressures while also undermining the investment needed for productivity and resilience. We also noted his call for complementary measures beyond monetary policy, including deeper EU market integration and targeted industrial-policy funding to support strategic investment such as AI.

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