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The UK Government is “making up its China policy as it goes”, exposing the UK to both economic and national security risks, MPs have warned in a new report.

In a 102-page document (pdf) published on Monday, MPs sitting on the Business, Innovation, Science and Trade Committee (Bist) accused the Labour government of failing to deliver on its 2024 promise to implement a “strategic, long-term, consistent” approach to China.

The Government has re-engaged with China without establishing the rules of the game required to protect British economic and national security, says the Bist report.

"Businesses are therefore navigating their relationship with one of the world’s most consequential economic actors without knowing where engagement is prohibited, where safeguards are required, and where the Government will actively support growth. This is not good enough."

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Successive governments have failed to reassure the security community, the public, or Parliament that they have taken adequate measures to defend UK national security and economic resilience, the report says.

The lack of predictability and clear guidance is hampering UK businesses’ ability to make commercial decisions about the Chinese market.

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Drawing on Britain’s strengths, it should provide targeted support for businesses in carefully selected sectors by negotiating better market access, increasing export finance, and enhancing guidance.

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The Government should pursue a new framework with three strategic objectives.

First, it should insist on fair trade, strengthening trade remedies and reforming procurement to enable British firms to compete on a level playing field. This should include preparation of tariffs to be deployed where China refuses to reform unfair competition practices.

Second, it should prevent the transfer of sensitive technologies and data to China by better resourcing the UK’s research security apparatus, strengthening the regulation of data traffic between connected vehicles in the UK and foreign entities, banning high risk connected tech from UK critical national infrastructure, and strengthening the Government’s powers of continuous review of foreign ownership of UK assets in strategic sectors.

Third, it should minimise the UK economy’s exposure to coercion, disruption and forced labour by developing a plan to secure UK supply chains and banning the import of products made using forced labour.

[The linked Bist report lists 42 measures.]

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