Government is ‘making up China policy as it goes’, MPs have warned in new report

The 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 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 report said the Government’s track record of decisions regarding Beijing – such as the last-minute blocking of plans by Chinese firm Ming Yang to build a wind turbine factory in Scotland over security concerns – was characterised by “reactivity, inconsistency, and opacity”.

It also warned of a tendency to “prioritise diplomatic politeness” over the UK’s national security, exposing the country to “unquantified, unmanaged risk” – including the transfer of sensitive data and technologies, and economic dependence on Chinese supply chains.

The lack of clear guidance hinders UK businesses’ ability to make commercial decisions about the Chinese market, the report also highlighted.

“Britain’s businesses cannot plan for the future when the Government keeps making up its China policy as it goes along,” Rt Hon Liam Byrne MP, chair of the Bist Committee, said.

“Ministers promised clarity and consistency.

“Instead, we have opportunities missed, risks unmanaged and decisions left until the eleventh hour.

“Britain must shape its own relationship with China, or risk having that relationship shaped for us in Washington or Beijing,” Mr Byrne further warned.

The new report has criticised the Government’s re-engagement with Beijing “without having finalised its audit or published a strategy”.

It comes after an audit on relations with China was completed in June 2025 but never published.

In its recommendations, the committee called for the Government to clearly designate “red zones” within the UK economy which should be off limits to Chinese trade and investment.

Ministers should also designate which forms of economic engagement can be permitted, subject to risk mitigation, and which should be “green zones” where trade is fully permitted and encouraged.

The report also recommended the preparation of a “tariff regime to be deployed if China refuses to rebalance its economy, continues to subsidise its industry unfairly, or fails to offer fully reciprocal market access”.

Preventing the transfer of sensitive data and technologies, securing supply chains so as to reduce dependence, and banning imports made using forced labour are also among the “new rules” set out in the report.

“Our report sets out clear new rules of the game: protect what Britain must control, manage the risks we can mitigate and back British firms where trade can grow,” Mr Byrne added.

“Those rules must have bite.

“Fair competition requires action against unfair subsidies.

“Economic security requires stronger supply chains. Human dignity requires a ban on goods made with forced labour.

“We should welcome trade that builds Britain’s strength. We should stop the trade that puts that strength at risk.

“That is how we turn engagement into growth, and growth into lasting security.”