China and the Rules-Based International System Contents

7The making of UK strategy towards China

“Dealing with” China

115.Some UK allies have been engaged in fundamental debates over their approach to China in recent years. The US has significantly changed its strategy towards China. President Barack Obama’s so-called “pivot” or “rebalance” to Asia involved an expansion of military presence in the region, and increased engagement with US allies, partners and regional institutions. President Donald Trump’s China strategy, however, has departed significantly from two decades of past policy, acknowledging a state of “competition” with China and conceding that previous attempts at engagement have not had the desired effect of changing China’s policies and its political system.226 Strikingly, as Kevin Rudd told us, there appears to be bipartisan US support for many aspects of this new course.227 Australia itself is also in the middle of a profound debate over its approach to China, spanning military, diplomatic and domestic political issues. The European Commission and the EU High Representative for Foreign Affairs and Security Policy in March 2019 issued a communiqué describing China as

a cooperation partner with whom the EU has closely aligned objectives, a negotiating partner with whom the EU needs to find a balance of interests, an economic competitor in the pursuit of technological leadership, and a systemic rival promoting alternative models of governance.228

The communiqué called on the European Council to adopt “a flexible and pragmatic whole-of-EU approach enabling a principled defence of interests and values”.229

116.Mr Rudd also told us of his own efforts to fundamentally rewrite Australia’s China strategy during his time as Prime Minister, which he said took two years of effort involving all government agencies, and resulted in a national China strategy at Cabinet level.230 No such national conversation has taken place in this country, though there have been signs of it beginning over specific issues such as China’s investment in the Hinkley Point nuclear power station, or Huawei’s role in telecoms infrastructure.

117.A common theme for all our witnesses was the need for the UK, whatever course it chooses on China, to work closely with allies. George Magnus said bluntly that he believed that “the UK’s voice in China will be all the smaller as it leaves the EU”, because China sees the EU as one of the “big powers” which govern world affairs.231 Other witnesses said that, regardless of their own views on Brexit, strong priority must be given to the UK working with allies, including the EU, because a collective voice will often carry greater weight with China than the UK’s voice alone.232 This does not stop the UK speaking out individually on issues it considers especially important: for example, it was put to us that the EU has struggled to achieve a common position on Chinese human rights because of some member states’ unwillingness to risk Chinese investment.233 Witnesses also told us of the importance of the Five Eyes intelligence alliance (between the UK, the US, Canada, Australia and New Zealand) in coordinating an approach to China.234

118.In tactical terms, a number of witnesses urged the UK to take a hard-headed approach to assessing what is and is not feasible in managing relations with China. As Kevin Rudd put it, “China respects strength and is contemptuous of weakness … China respects consistency and is contemptuous of wavering”.235 Lord Patten urged the Government not to fear Chinese economic retaliation if the UK pressures China on issues such as human rights or Hong Kong, calling such a position “craven”, and noting that in the two years after the downturn in UK-China relations when Prime Minister David Cameron met the Dalai Lama in London in May 2012, UK exports to China went up. Nervousness in such matters, he said, encourages China “to behave badly”.236 Professor Tsang agreed, arguing that Chinese officials “will be just as interested in protecting their economic stability and therefore the capacity of the Communist party to stay in power as we are in protecting our economy”.237

The tone and structure of UK policy towards China

119.Since Xi Jinping’s visit to the UK in 2015, the British and Chinese governments have referred to the existence of a “Golden Era” in UK-China relations.238 This remains the preferred phrase: during her visit to Beijing in January 2018, Prime Minister Theresa May said that she and President Xi had committed to “intensify” the Golden Era.239 The bilateral relationship between the UK and China is managed through the Global Comprehensive Strategic Partnership established in 2015, which the FCO describes as consisting of:

a framework of Prime Ministerial summits; annual top-level dialogues covering foreign and security policy, economic and financial issues, and people to people cooperation; and a wide range of Ministerial and expert exchanges, for example on counter-proliferation, counter-terrorism, international development, cyber, international law, Asia, Africa and the Middle East.240

120.The 2015 National Security Strategy and Strategic Defence and Security Review (NSS & SDSR) addressed China primarily in economic terms: China was mentioned explicitly, along with India, in the top-line summary of the NSS & SDSR objective “Promote our Prosperity”.241 By contrast, China was not mentioned alongside Russia in the section dealing with states that ignore international norms.242 The NSS & SDSR defined the main aim for UK strategy on China as being “to build a deeper partnership with China, working more closely together to address global challenges”.243 The Joint Committee on the National Security Strategy (JCNSS) called the NSS & SDSR 2015 “overwhelmingly positive about China”,244 and, while it acknowledged the difficulty of discussing problems in bilateral relationships in a public document, the JCNSS criticised the strategy for failing “to take into account a range of fundamental concerns”, including human rights, the “dumping” of industrial products, cyber espionage, and the militarisation of the South and East China seas.245 “In short”, concluded the JCNSS, “it highlighted the economic possibilities and marginalised the risks”, and “contradicted the weight attached throughout the same document to promoting ‘core British values’”.246

121.Subsequent updates to the NSS & SDSR 2015, provided in the Annual Report of 2016 and the 2018 National Security Capability Review (NCSR), have not explicitly altered this framing of the UK’s approach to China, and the overall goal “to build a deeper partnership with China” remains in place as an ongoing action item.247 The NCSR does, however, point out the “risks of miscalculation and conflict” from competition between states in the South China Sea.248 In the FCO’s objectives for 2015–16 and 2016–17, China was explicitly mentioned under the Prosperity objective, in keeping with the NSS & SDSR framework. In its objectives for 2017–18 and 2018–19, China is not explicitly mentioned at all.249

122.In October 2018, during his first evidence session with us after becoming Foreign Secretary, Jeremy Hunt told us that dealing with the rise of China was one of his highest priorities:

We have a China that is rising. We welcome its rise—we cannot stop it—but that is going to cause a fundamental change in the way nations interact with each other. I want us to have understood that and to make sure we are ready for it.250

123.We wrote to the Foreign Secretary in January 2019 to ask about the Government’s China strategy, including when it was last updated. The Foreign Secretary told us that the “overall strategic approach is agreed by the National Security Council”, and that the Deputy National Security Adviser, as the senior responsible officer for China, chairs the cross-Government China National Strategy Implementation Group (NSIG). He said that “FCO work contributes to all areas of our China approach”, and that

The strategy underpinning our approach to China was last updated as recently as November 2018, covering the depth and breadth of UK-China engagement and the implications of China’s growing geopolitical and global role. While the detail of NSC meetings and conclusions are not published, senior officials regularly consider our approach to China, including key issues such as maintaining cyber security, protecting critical national infrastructure, and promoting UK prosperity, and UK values. Our priority in this work will always be defending the UK’s strategic interests.251

In the letter, the Foreign Secretary notably does not refer to a China strategy per se, but rather an “approach to China”, and a “strategy underpinning” that approach.

124.When we asked the Minister how UK strategy had changed in order to keep pace with the changes in China’s geopolitical trajectory under Xi Jinping, we did not get the impression that a clear strategic direction had been set. The Minister referred to the existence of areas of “common ground”, of “areas where we fundamentally disagree”, and of the need to “build as much of a body of trust as we can”.252 This does not amount to an agreed government-wide strategy for dealing with what the Foreign Secretary has identified as one of the single most important features of the international system. In particular, we fear that this approach overlooks the fact that the “areas where we fundamentally disagree” with China relate to issues that the FCO itself has identified as key UK priorities, including the following items in the FCO’s Priority Outcomes for 2018–19:

In the past year alone, China has acted, in very high profile ways, directly in opposition to all three of those objectives. China has violated its bilateral commitment to the UK on cyber security; it has impeded effective action on Syria and chemical weapons at the UN; and it has pushed its alternative vision of human rights as a counter to the existing international legal framework and mechanisms. We believe that such divergences will be closer to the norm than the exception in UK-China relations in the future.

125.The current framework of UK policy towards China reflects an unwillingness to face the reality of China’s strategic direction. In some fundamental areas of UK national interest, China is either an ambivalent partner or an active challenger. This does not mean that the Government should seek a confrontational or competitive relationship with China, or that it should abandon cooperation. But we must recognise that there are hard limits to what cooperation can achieve; that the values and interests of the Chinese Communist Party, and therefore the Chinese state, are often very different from those of the United Kingdom; and that the divergence of values and interests fundamentally shapes China’s worldview.

126.Building a deeper partnership with China is still desirable, but it is not sufficient as a single, overarching goal for UK policy towards China. In particular, it risks prioritising economic considerations over other UK strategic interests, values and national security. This is clear from the current contradictions in UK policy. If the Government had not already committed in rhetorical terms to a “Golden Era” in UK-Chinese relations, we question whether it would be appropriate to do so now. There does not appear to be a clear sense either across Government or within the FCO of what the overarching theme of a new policy towards China should be, or how the UK should work with European partners and other allies to implement it.

127.The Government has not been able to present a China strategy to us. It has a strategic goal set out in the 2015 National Security Strategy and Strategic Defence and Security Review, and it has what it refers to as an “approach to China”, with a group under the National Security Council to implement that approach and to update “the strategy underpinning that approach”. This is not sufficient. The UK needs a single, detailed document defining a national strategy towards China, endorsed at Cabinet level. This will be an essential guide to all Government departments in shaping China policy, and will make sure that the Government is speaking with one voice. It will also send a clear public message to businesses, media, academia and civil society, to the UK’s allies, and to China itself.

128.The Government should develop a single, detailed, public document defining the UK’s China strategy. This cannot wait until the next Strategic Defence and Security Review process. The strategy should not assume that the existing strategic goal for China policy will be maintained (to “build a deeper partnership with China, working more closely together to address global challenges”). The overall goal should be defined based on a realistic assessment of China’s long-term strategic trajectory and how that trajectory affects UK interests. Economic considerations should be set in the context of the UK’s strategic interests, values and national security. UK policy on China should acknowledge not just areas of difference, but areas where China is actively working against UK interests. Government departments should produce their own work plans for implementing this new strategy.

129.The crafting of the UK’s China strategy should be led by senior Ministers and directed by the FCO. It must set out an assessment of the ways in which China has changed since the direction of the UK’s China policy was set in 2015, and the ways in which the changes affect UK interests, values and national security. It must also address the following questions:

a)What are the drivers of Chinese foreign policy? How is Chinese foreign policy made, by whom, and for whose benefit?

b)What are the major goals we seek to achieve in UK policy towards China?

c)What is the bottom line of UK interests, values and national security considerations on which we are not prepared to compromise?

d)What are the points of convergence and divergence in UK and Chinese values, interests and national security? How is this likely to change in future?

e)What scope is there for the UK to work with China in strengthening the integrity of, and respect for, global rules, norms, and institutions?

f)What balance should be struck between the need to trade freely with China and the upholding of international human rights, intellectual property, the rule of law, regional security, alliance commitments and UK national security?

130.We call on the Government to develop a new draft China strategy by Spring 2020, and to consult widely upon it, including with this Committee. We recommend that the FCO appoint an independent advisory council of non-governmental experts on China to feed into this process. The Government should be in a position to publish a single, detailed, coherent cross-Government China strategy by the end of 2020. The challenges and opportunities presented by China’s rise deserve no less than this comprehensive and ambitious approach. A constructive, pragmatic and often positive UK relationship with China is possible. But achieving this will require strategy, rigour and unity in place of hope and muddling through.

228 European Commission and the High Representative of the Union for Foreign Affairs and Security Policy, EU-China – A strategic outlook, 12 March 2019, page 1

229 European Commission and the High Representative of the Union for Foreign Affairs and Security Policy, EU-China – A strategic outlook, 12 March 2019, page 1

231 George Magnus (CIR0023)

232 See Q25, Q37

233 Dr Yuka Kobayashi (CIR0022)

239 10 Downing Street, Prime Minister’s press conference with Premier Li, 31 January 2018

240 Foreign and Commonwealth Office (CIR0018)

242 2015 NSS & SDSR, para 3.35

243 2015 NSS & SDSR, para 5.74

244 Joint Committee on the National Security Strategy, First Report of Session 2016–17, National Security Strategy and Strategic Defence and Security Review 2015, HC (2016–17) 153, para 28

245 Joint Committee on the National Security Strategy, First Report of Session 2016–17, National Security Strategy and Strategic Defence and Security Review 2015, HC (2016–17) 153, para 29

246 Joint Committee on the National Security Strategy, First Report of Session 2016–17, National Security Strategy and Strategic Defence and Security Review 2015, HC (2016–17) 153, paras 29 and 31

249 Foreign and Commonwealth Office, Annual Report and Accounts: 2017–2018, pages 6 and 42

250 Oral evidence from the Foreign Secretary, HC 538, 31 October 2018, Q331

251 Foreign and Commonwealth Office (CIR0031)

253 Foreign and Commonwealth Office, Annual Report and Accounts: 2017–2018, page 42

Published: 4 April 2019