Key facts
- The Commons business and trade committee said the UK has no consistent China strategy and risks having it set by Washington or Beijing.
- The committee cited the blocked £1.2bn Chinese wind plant and the seizure of a Chinese-owned factory as evidence of inconsistency.
- Chair Liam Byrne said Britain's businesses cannot plan when policy is made up as it goes along.
- The report recommends a red zone barring Chinese investment in sensitive industries and a green zone encouraging trade.
- The committee said the UK should consider aligning with EU trade rules, including EV tariffs, to keep access to the EU market.
A UK parliamentary committee concluded that the government is making up its China policy as it goes along and risks having its strategy dictated by Washington or Beijing. The Commons business, innovation, science and trade select committee said in a report that the government had failed to deliver the coherent, long-term approach it promised in 2024.
The committee's chair, Labour MP Liam Byrne, said British businesses cannot plan for the future when policy keeps changing. The report said the government had combined the worst of both worlds: it could neither deliver commercial opportunities nor control what it called increasing exposure to unquantified, managed risk.
The committee pointed to the decision in March to block Chinese firm Ming Yang from building a £1.2bn wind energy plant in Scotland after years of negotiation, citing unspecified security risks. It also cited the emergency takeover of British Steel from its Chinese owners, saying both decisions were marked by reactivity, inconsistency and opacity. Scotland's first minister, John Swinney, has called on Andy Burnham to reconsider the wind plant decision.
The report recommended clear new rules, including a red zone of industries off-limits to Chinese investment and a green zone where trade should be encouraged. It said work on a new strategy should be combined with preparations for trade remedies against unfair competition, including potential tariffs on electric vehicles, which Downing Street has not ruled out. Byrne said the government should consider dynamic alignment with the EU, including EV tariffs, to secure British firms a place in the EU's Made in Europe project. Business secretary Jonathan Reynolds has said he will decide on EV tariffs in the best interests of the UK.
The committee acknowledged that British businesses have profitable operations in China and want to grow, and that consumers benefit from low-cost imports such as electric vehicles. It noted that China is on track to surpass last year's record $1.19tn trade surplus and that its latest five-year plan prioritizes green exports including EVs, batteries, wind turbines, hydrogen and solar panels.