Coronavirus: This crisis shows Britain’s reliance on China

It seems an eternity ago that David Cameron was prime minister, talking up the prospect of a “golden era” for Britain’s relations with China, and enjoying a pint of bitter with his friend Xi Jinping in the boozer next to Chequers, not so very far from where his successor is recuperating from a disease that originated in the east of the people’s republic.

The Tory party’s divisions over China are opening up, and posing some substantial questions for the UK in the 2020s. The coronavirus crisis has laid bare the extent to which the west, including the UK, is reliant on China industrially and technologically. From the very earliest stages of the pandemic it was apparent that long “just in time” global supply chains ended up more often than not in China. Everything from components for a Nissan car made in Sunderland to a face mask used by a doctor in Belfast originated in China, and was suddenly in short supply.

One of the first acts of Theresa May’s government was to review the involvement of Chinese companies in Britain’s civil nuclear power programme – key national infrastructure. We already knew that the west’s trade deficits leave many nations literally in hock to China – to the tune of trillions of dollars. Chinese investors hold huge swathes of American and European government debt and stakes in private companies.

A more recent and even more sensitive issue is national security. Long before the Covid-19 emergency, some senior Conservatives, such as Iain Duncan Smith and another 40 or so rebels, objected to Huawei’s role in building Britain’s 5G network.

They argue it leaves the UK’s national security, and its international security links, too compromised to a company ultimately loyal to the Chinese state. Huawei denies it is controlled by the Beijing government. By contrast the more economically liberal Tories, notably Sajid Javid, in a new intervention wish to see the usual patterns of international trade restored as soon as possible.

Inside and outside Conservative ranks, and across many western nations, the debate is becoming one between those who want to reverse globalisation and those wanting to preserve and extend it.

There is no clear right or wrong answer to this conundrum, but merely a series of trade-offs. Essentially these are of national sovereignty and economic independence on the one hand, and securing a supply of economical and increasingly high-tech goods and services from the world’s second largest economy (and already bigger than the US and the largest on some measures).

In the context of Brexit, it was often argued that leaving the European Union would open up the opportunity for a UK-China trade deal, and more exports from the UK to China (where Britain has lagged behind the likes of Germany). It seems obvious that a British government perceived to be hostile to Chinese involvement in the UK, and markedly reluctant to grant student visas to Chinese youngsters, will not be warmly welcomed in China. How would Britain be placed then if the Chinese develop the first vaccine? The UK is after all a relatively small international economic player compared to China – they have more bargaining power.

The old adage that sovereignty is not like virginity, something you either have or don’t have, springs to mind. There are trade-offs and compromises. The coronavirus data has reminded us that the Chinese Communist Party is not always a transparent regime. The brutal treatment of Hong Kong protesters (their rights covered by a Sino-British international treaty) and the persecution of a million Uighur Muslims would make any liberal nation pause in developing its relations with Beijing. We will have an opportunity to trade more with China, post-Brexit, and support export industry jobs in Britain.

The UK can keep its distance from China and even “reshore” manufacturing jobs long since lost to lower cost factories, and keep its infrastructure controlled entirely by British or western companies. But if it does, there will be a price to pay, somewhere along the line.