China is hoping the advent of a new British government will offer a chance to reset the volatile relationship between the two countries, but it is unlikely to be plain sailing.
State media has latched on to reports that the new Foreign Secretary David Lammy is “considering” a visit at some point.
Zhao Junjie, a member of the Chinese Academy of Social Sciences, told Global Times, a newspaper owned by party mouthpiece People’s Daily, that the government “is likely to uphold the relatively friendly approach” of Tony Blair’s previous Labour administration.
Appetite for engagement will doubtless be welcomed, but Beijing should not assume that Keir Starmer’s new Labour government will give it an easy ride. A lot has changed since Blair left office in 2007.
So far Labour has been vague about its plans for China and the slogans its leaders adopted on the campaign trail could be interchanged with those of the European Union’s leaders.
These bromides suggest that, like all Western governments, Labour is still grappling with how exactly it should deal with Beijing – although it finds itself in a position of relative strength.
“The government has a huge majority and a significant amount of goodwill both within parliament and the press to consider a different approach on China. That, of course, does require having the bandwidth and the desire to be proactive,” said Sam Goodman, senior policy director at the China Strategic Risks Institute think tank.
In fact Lammy had already been planning a visit but this was scuppered when Rishi Sunak unexpectedly called an election in June, according to people familiar with the plan.
The groundwork had been laid by Catherine West, now the minister responsible for the Indo Pacific, who travelled to the Chinese capital in March as part of a parliamentary delegation that met Wang Huning, one of Xi Jinping’s closest advisers, and foreign vice-minister Deng Li.
A China audit is expected to be announced within the government’s first 100 days, although there has been no commitment on delivering a “China strategy” document, even if most in Westminster agree that one is needed.
It also remains to be seen what campaign slogans – such as the “securonomics”, proposed by Chancellor Rachel Reeves or Lammy’s call for “progressive realism” – will translate into policy.
“The what and especially the how of securonomics remain unclear,” said Francesca Ghiretti, a research leader specialising in geoeconomics at the RAND Europe think tank.
“The focus of Labour’s economic security plans is likely to be on growth, which we can see from early statements. Yet, without an explicit strategy to guide the different initiatives and efforts, the government risks investing resources without seeing the needed results.”
A strategic defence review, however, suggests which way the wind is blowing. It is being led by George Robertson, the former Nato chief, who recently lumped China in with Russia, Iran and North Korea as a “deadly quartet”.
Other signposts include the proposed listing of Chinese fast-fashion giant Shein on the London Stock Exchange, which was refused a listing in New York over “supply chain problems”.
This would be a shot in the arm for the City of London, but presents a significant political challenge, with American lawmakers already pressuring the authorities to refuse the listing.
Accusations of forced labour, as well as concerns about the firm’s environmental impact and working practices, have also prompted concerns the listing could damage London’s reputation as a leading centre for ESG (environmental, social and governmental) investments. Reuters reported last month that the sector was likely to give the firm the cold shoulder.
06:27
‘Full audit’ of Sino-UK ties as new Labour Party government looks for reset in bilateral relations
‘Full audit’ of Sino-UK ties as new Labour Party government looks for reset in bilateral relations
Britain must also decide whether it joins the EU and United States in slapping tariffs on Chinese-made electric vehicles.
Trade Secretary Jonathan Reynolds last month suggested he would not follow their lead, saying: “I am not ruling anything out but, if you have a very much export-orientated industry, the decision you take [has to be] the right one for that sector.”
Charles Parton, who spent four decades working as a UK and EU diplomat on China, said there is a “political dimension” to this debate, suggesting there was likely to be pressure from Washington.
“Are you with us? Are you not with us? Are you the weak link? You’re a member of Five Eyes. You’re a member of Aukus. Don’t forget that – so watch this space,” Parton said, referring to Britain’s security alliances.
In opposition Labour called for the government to impose heavy penalties on Beijing over human rights issues, and observers are now watching how it will respond to the ongoing Hong Kong national security trials.
Last year, West, a founding patron of the Hong Kong Watch NGO, asked the government to “reassess whether it is in order for sanctions to be placed on leading members of the Hong Kong government” after “warrants and bounties were issued against pro-democracy activists by Hong Kong national security police”.
Lammy has also pledged to follow parliament’s lead in declaring that the Chinese government has committed genocide in Xinjiang. “Parliament took a decision about genocide, the international community is very concerned about genocide,” Lammy told Politico last year.
But over the longer-term, the government may find it faces similar problems to its European neighbours.
Like the EU, it has a ballooning trade deficit, which reached US$27.57 billion over the first half of this year, according to Chinese customs data.
As a service-driven economy, it is slightly less exposed to the industrial overcapacity challenges often cited in Brussels, but as a European leader in technology and engineering will be concerned about hi-tech competition.
It too walks a fine line between courting Chinese investment – such as a proposed US$1.5 billion in a gigafactory near Coventry from lithium battery maker EVE Energy – while screening perceived risky acquisitions.
Labour’s “challenge, compete, cooperate” framework for Beijing is an effective rehash of the EU’s “partner, competitor, rival” triptych – it could mean just about anything to anyone, but all too often in policy terms means nothing at all.
China’s close relationship with Russia, which has poisoned the well in most European capitals, is another ongoing problem. Lammy used his first meeting with his Chinese counterpart Wang Yi, to urge Beijing to “prevent its companies supporting Russia’s military industrial complex”.
The result of the US election will also have a great impact and as a member of the Five Eyes security grouping and Aukus, Keir Starmer’s government will be more vulnerable to Washington’s cajoling on China regardless of who wins.
Labour is, however, far more ideologically aligned with Democratic candidate Kamala Harris than Donald Trump.
In some ways, though, Britain is in better condition than the EU to form a coherent China strategy.
While Brussels has recently started asking diplomats in foreign delegations to report on China’s activities in their regions, that is only one part of their job. By contrast London has a network of dedicated China officers dotted all over the world and is spending millions on the endeavour.
01:30
Matthew Trickett, Briton accused of spying for Hong Kong, found dead in park
Matthew Trickett, Briton accused of spying for Hong Kong, found dead in park
Nor does it need the unanimity of 27 governments to forge policy, a “Brexit dividend” the previous Conservative government was unable to explore because of its internal divisions and the resulting pressure from backbench hawks.
In his last post on the now defunct but widely read Beijing to Britain newsletter, Sam Hogg, from Oxford China Policy Lab, bemoaned the lack of clarity.
“Something is going wrong … the relationship between government, parliament and Whitehall is not working, and the reality that foreign, domestic and industrial policy are interlinked has not sunk in,” he wrote.
“Things can, and must, change. This is not a time to smuggle indecision dressed up as caution, or to hope things just work out. It is time to reform the systems which underpin how we understand the world.”
