China: Security and Trade (IRDC Report)

The Government’s response did not confirm whether they would publish a written strategy on China. Instead, they referred us to the integrated review of security, defence, development and foreign policy. However, the IR simply alludes to the tension between balancing economic engagement with China with the need to uphold UK values and national security. It does not give any indication about how this tension will be resolved.

During this summer’s leadership contest, the Times reported that my right honourable friend the Prime Minister, then the Foreign Secretary, would class China as a “threat” to national security for the first time. However, the reporting was light on details—it was not clear what classing China as a “threat” would mean in practice, for example—and no further announcements have yet been made on this matter since the Prime Minister took office. What further details can my noble friend the Minister supply about the Government’s plans in this area?

I note that the Government have pledged to update the integrated review, saying that the updated review

“will ensure we are investing in the strategic capabilities and alliances we need to stand firm against coercion from authoritarian powers like Russia and China.”

I welcome the idea of updating the IR, but rumours are going around that it will not appear until next May. In the current volatility of events, one suspects that it may be even further delayed. Will there be any consultation on the key issues before the report is published?

I turn now to five specific issues: Taiwan; supply resilience; human rights; Chinese influence on UK universities; and, finally, the implications of China’s stance on Russia’s illegal and unprovoked invasion of Ukraine.

Our report argued that any assessment of China’s threat to the UK should take into account both the probability and likely consequences of conflict in Taiwan. We argued that the UK’s interests would be directly threatened, and concluded that:

“The uncertainty over the future of Taiwan therefore represents a major risk to the UK.”

The Government’s response to this section of our report provided limited information. It merely stated that the Government

“support a peaceful resolution through constructive dialogue”,

and that

“the numerous Chinese military flights at the beginning of October”—

in 2021—

“near Taiwan were not conducive to peace and stability in the region.”

It was astonishing that there was not a single reference to Taiwan in the integrated review.

Last weekend, the five-yearly Chinese Communist Party congress opened in Beijing. It is expected to endorse an unprecedented third five-year term for Xi Jinping as party general secretary—the de facto President. On the very first day of that congress, he said:

“We insist on striving for the prospect of peaceful reunification with the greatest sincerity and best efforts, but we will never promise to give up the use of force and reserve the option to take all necessary measures.”

I understand the diplomatic sensitivities on this matter but would be grateful if my noble friend the Minister can provide an analysis of the UK’s assessment of risks and a potential response to further developments in Taiwan.

The committee also explored the issue of supply chain resilience and vulnerability in the context of the UK-China relationship. The passage of the Telecommunications (Security) Act 2021 was a clear sign of the Government’s concerns in one area, but these vulnerabilities are much more widespread across the UK economy. We were particularly concerned about vulnerabilities exposed during the pandemic relating to the procurement of PPE and lateral flow tests. In subsequent correspondence, the Government confirmed that, as of 10 January this year, the total cost of lateral flow tests from China and procured by NHS Test and Trace or the UK Health and Security Agency was £5.8 billion.

Of course, it is important that the UK engages with China economically, and our report highlights a number of opportunities for UK businesses, particularly in the services sector. It is also vital to co-operate with China on global challenges, including public health and climate change—a subject on which my noble friend the Minister has particular expertise. This engagement with China should not, however, come at the cost of upholding the UK’s core values, including on human rights and labour protection—values which China does not share.

In April last year, a Motion was passed in the other place declaring that Uighurs and other ethnic and religious minorities in Xinjiang are suffering crimes against humanity and genocide. Our report stressed that the question of how to balance economic engagement with human rights must be front and centre of the Government’s strategy on China. We concluded that the Government cannot “sit on the fence” on this issue, and that they must not tilt the balance towards preserving economic relations at the expense of human rights.

I am pleased to say that the Government’s response indicated that they agree with the committee’s position in this area. In subsequent correspondence, the Government also confirmed that

“serious concerns about human rights violations in Xinjiang naturally inform our position towards China”.

I would therefore be grateful if my noble friend the Minister could give a practical example of how it informs our position What is the effect?

There has been increasing concern that British universities could be a target for technological espionage and that Chinese students in the UK could be put under pressure by the Chinese authorities. Clearly, the Government should seek to maintain the role and popularity of British higher education among Chinese students, but we recommended that the Government and the higher education sector should take steps to ensure that Chinese students can maintain freedom of research. The Government’s brief response to this recommendation did not, however, outline the steps that they intended to take. Moreover, when we raised this with them in subsequent correspondence, they referred us to the measures that they are taking through the Higher Education (Freedom of Speech) Bill, shortly to go through its next stage in this House. However, the relevance of that Bill to the specific issues facing Chinese students is not clear: the pressure they are facing comes from outside, from the Chinese Government, not from within the UK.

The Bill had its Second Reading on 28 June this year when several Peers raised specific concerns about China’s influence and pressure. When my noble friend Lord Howe wound up the debate for the Government, however, I could not find a single reference to China in his remarks. Can the Minister therefore provide clarity on the steps the Government are taking to protect Chinese students from political pressure from outside the UK and the role, if any, that is played by the Higher Education (Freedom of Speech) Bill in providing that protection?

Russia’s illegal and unprovoked invasion of Ukraine dominates most of the immediate foreign policy of western leaders, which is of course wholly understandable. It is vital, however, that we do not divert our attention from the activities of the People’s Republic of China, which could be viewed as the biggest long-term threat to our economic and national security. For its part, China has refused to openly condemn Russia’s invasion. It has opposed economic sanctions on Russia. It has abstained or sided with Russia in UN votes on the war. The new NATO strategic concept document agreed earlier this year raised concerns about China’s “deepening strategic partnership” with Russia.

However, China’s support for Russia has not yet been full-throated. As far as we know, it has not provided Russia with significant military assistance and, at the recent meeting of the Shanghai Cooperation Organisation, President Putin admitted publicly that China has “questions” and “concerns” about the war. How does China’s position on Russia and Ukraine inform the UK’s own position on China? I would be grateful if the Minister could set out the Government’s thinking in this regard.

Engaging with China will always be an enormous challenge, given its economic weight and its fundamental political differences from us. It would be unwise to think that there will be any softening of President Xi’s hard-line policies of competition with western democracies. It is essential for the UK to be aware and wary of the implications of that for our own security, trade and prosperity. The UK’s strategy for its relations with China needs more clarity and certainty than it has had until now. Trade-offs need to be confronted and ambiguities resolved. I hope that the Government will now provide more clarity and fill the strategic void that has beset the UK’s China policy over the last decade. I beg to move.

I turn to some of the issues concerning our economic, trade and cultural relations with China. We cannot turn our back on engagement with a country with the second-largest economy in the world, which is likely to overtake the USA and become the largest within two decades. After all, China is the UK’s third-largest trading partner. As a member of the G20 and the UN Security Council, it is also a hugely important player in global security and the global economic order.

With respect to multilateral economic negotiations with China, the committee highlighted in its report the importance of World Trade Organization reform, where the role of China is crucial. It welcomed the Government’s intention to play a part in the WTO’s strengthening and reform, but regretted that it said so little about how it would do so. Can the Minister say what the Government have done so far and what their future intentions are, focusing on how they would support in this area our economic and strategic objectives with China?

The committee took the view that we should use our soft power wherever possible in engaging with China—a position I strongly endorse. The UK has one of the strongest higher education systems in the world, with many universities excelling in research, teaching or, in some cases, both. This is reflected in the very large number of international students choosing to study here, including those from China. While no single university should have so many Chinese students that the composition of its student population becomes very unbalanced—nor, incidentally, should they be admitting students with poor written and spoken English, as sometimes happens with Chinese students—there are benefits to the UK in students from China studying here. Many of them are extremely able and very hard-working. I remember in my time as Master of Birkbeck that the only students to be seen in the institution over Christmas were the Chinese—they were there throughout the holiday.

I certainly think that it is an advantage to us that young Chinese, able young people, should be exposed to a different culture and value system which has the potential to broaden their outlook as they perceive the importance of the UK attitudes to openness, human rights and democracy. However, if this is to apply, there must be no restraints on freedom of speech, as the noble Baroness, Lady Anelay, said, and there must be freedom to pursue research for Chinese students. There is a particular danger in researching some sensitive areas of technology which may have military as well as civilian uses, but the solution is not to withdraw from Chinese involvement but instead rigorously to assess the risks and to take action to mitigate such risks.

I hope too that the British Council and others will encourage cultural activities. There is, for example, a big appetite in Chinese cities for British performances of classical music and ballet, as well as an interest in English writing and literature and in British design, as I know from my experience as chair of the British Library. It is a missed opportunity to neglect soft power of this kind, and I hope the Minister will endorse that.

I will leave some of the threats to security posed by Chinese military power in the South China Sea and beyond, as well as the danger to some developing countries of belt and road policies, to other speakers. However, I ask the Minister, following the noble Baroness, Lady Anelay, how the Government are reacting to the very worrying comments on Taiwan made by President Xi in his speech last weekend to the Chinese Communist Party’s 20th Congress, with the threat of possible force to secure the co-operation of incorporation of Taiwan into mainland China. Are we urgently discussing an appropriate response with our allies in the international community?

I turn to an important area where we may be able to find common cause with China, and that is climate change. The noble Baroness, Lady Anelay, asked, in her follow-up letter to the Government’s reply to the committee’s report, for further information on how the Government plan to co-operate with China following COP 26. The reply from the Minister for Asia at the time was rather vague and procedural, citing the various contexts in which collaboration was taking place but giving virtually no detail on the content of such discussions. China has been the largest global emitter of carbon since 2006 and is now the second-largest historic producer of emissions, although it is well behind the United States. Its very size and the extent of its industrialisation mean that its climate change policies have a huge global effect.

However, the positive side is that China’s per capita consumption-based emissions, taking account of international trade, remain lower than those of the UK. Moreover, according to the International Energy Agency, its investment in clean energy amounts to a massive 30% of total global investment. It would be appropriate for the UK to recognise the efforts China is making to tackle climate change, with a goal to reach net zero before 2060. Nevertheless, there are still areas of concern, notably the fact that China is continuing to invest in new domestic coal, even though it has committed to end funding for overseas coal investment. What progress has the UK made in debating with China the continuing use of new coal, which could certainly jeopardise its net-zero targets?

I end by pointing out that our engagement with China cannot be pushed on one side. It can and should be constructive, but we must never pull our punches, particularly on human rights abuses, Taiwan, Hong Kong and on stretching WTO rules entirely in its own interest. The abandonment of any semblance of collective leadership with Xi Jinping’s appointment for a further five-year term involves a dangerous concentration of power in the hands of one man—a man whose ideological fundamentalism poses quite a big threat both to China and the rest of the world.

There does not appear to have been any material impact on the conduct of Mr Putin as a result of this discussion, to which I have referred and, indeed, one could argue, particularly in recent days with the deliberate targeting of civilians and civilian properties, the conduct of Russia and its forces has deteriorated even further. Indeed, one could argue that, particularly in recent days, in the deliberate targeting of civilians themselves and civilian properties, the conduct of Russia and its forces has deteriorated even further.

President Xi is, as the noble Baroness confirmed in opening our debate, likely to be elected for a record third term at the National Congress of the Chinese Communist Party. Some have described this as a watershed, politically, militarily and economically but, so far, it does not appear that the ambitions of China are anything other than more of the same, except perhaps more extreme. As far as the leader of China is concerned, his confirmation will give him historic authority and, perhaps, overconfidence, which may explain his unspecified warning of the threat of “grave international developments”.

All of this is coupled with the assertion, to which the noble Baroness drew our attention, that military means are still on the table, as far as China is concerned, to further its ambition to bring Taiwan back into the fold. It is an interesting feature of the personality and ambitions of both Putin and Xi that they share a common interest in the pursuit of territory which, once upon a time, was regarded as being within their influence, to restore it in some kind of missionary approach as being truly part of the motherland to which it should now be restored.

As I said, in the case of Hong Kong, there is more than simply disappointment that the terms of the return of Hong Kong to China have been so badly treated. They were maintained for a period and the conditions followed as stipulated, but it is against that unhelpful background of change that the United Kingdom now needs to consider the establishment of a clearly defined relationship with China. As has already been pointed out, there is far from clarity on that matter, when clarity is urgent. It must be a relationship which does not prejudice our values; it must be a relationship that, from the point of view of both parties, is of mutual advantage. It is trite to say that it will almost certainly not be easy.

Such a relationship would best be viable if it is done with allies—I have particularly in mind allies from Europe. Our departure from the European Union is of course unhelpful in this regard, but it is not prohibitive. Respectfully, it seems to me that this would be an important way of establishing a relationship with Europe in which, thus far, the present Government, have shown little interest in creating.

In any discussion about a relationship, there will inevitably be the issue of ethical foreign policy. I remind noble Lords—because I was there when he said it—that Robin Cook never said that we had to have an ethical foreign policy. What he said was that we had to have a foreign policy with an “ethical dimension”. The truth is that in extreme circumstances, where the interests of the nation are at stake, there might be a move to depart from a strictly ethical approach. I do not believe that that is anywhere near what we are discussing in this debate, but it is important to ensure that an ethical foreign policy is not to be used as a blanket and simply the basis for refusal. It also has to take account of the fact that President Xi is open in his belief that the rules conceived in the years immediately after the Second World War do not reflect the circumstances of 2022. There may be some scope for altering rules, but there can never be any scope for abandoning the principles which lie behind them—principles which are as important today as they were in the period after the Second World War.

Let me finish, if I may, on this point. Our interest and our interests in our relationship with China should not be episodic. This is a relationship, if it is achieved, that will require consistent and continuing review. We would not expect the Government to do anything other than to approach the matter in that way, but in addition to government implementation, there is an overwhelming obligation to ensure that the legislatures—both this place and the House of Commons—have the opportunity to keep responsibility for implementing any such agreement, as I have said I believe is appropriate. The reasons for that are very simple: as the summary says, the issue is complex, and it has certainly changed very rapidly over a short period of time. There is nothing to suggest that these two characteristics will not continue to have an influence on our relationship with China.

Beyond that, it is clear that China is, as one inquiry witness put it, out to make the world safe for autocracy. For those who have not read it, the special report in the latest edition of the Economist sets this out in stark terms. The Government’s response to the committee’s report admits that:

“Aspects of China’s approach to the multilateral system run counter to UK interests and values”,

and goes on:

“We will continue to take targeted action with international partners to defend universal human rights, free and fair trade, and ensure that in areas, such as emerging technology or space, that new rules, norms and standards enable freedom and democracy to survive and thrive.”

This is woefully inadequate. It makes the whole thing sound like a piece of peripheral business.

In fact, we are, or certainly should be, engaged in a fierce contest to determine the rules of the international order under which we will have to live and operate for most of the rest of this century. Very few things could be more central to our future welfare and prosperity; securing the right outcome should be one of the highest foreign policy priorities for the UK. It certainly is for the United States. President Biden has made his Administration’s position very clear on this and has set about assembling the necessary international economic, technological and military weight to counter that of China.

None of this is to argue against the desirability of business, academic and cultural links with China, but setting out the UK’s priorities in this regard would make it clear that those other areas of engagement would all be contingent upon the pursuit of our objectives regarding the international order. It is hard to see how spelling this out would endanger our security. It would, however, give those in business and elsewhere a clearer idea of the downside risks associated with such engagement.

As it is, if one reads the Government’s response regarding Huawei, for example, one gets the clear impression that this company would now have a substantial hold over our 5G network had the Americans not rather annoyingly imposed additional sanctions on it. A little earlier, the Government’s response says that the National Security and Investment Act is “country agnostic”. That might be true with regard to the wording of the Act, but to suggest the same is true of its application seems to me breathtakingly complacent.

The principal risk for UK business is of course the likely adverse Chinese reaction to our opposition in the contest to determine the future rules of the international order. The committee called on the Government to conduct an impact assessment of such an outcome. The Government’s response is a fine example of departmental waffle:

“The … relationship … is multifaceted”;

they will

“manage disagreements and defend our values while preserving space for cooperation in tackling transnational challenges … and … continued pursuit of a positive trade and investment relationship in line with our national security and values.”

It is cakeism at its best. But what do we do if somebody takes away the cake? We are given no answer.

This Panglossian approach is also evident in the Government’s response on higher education. They say:

“We will also ensure that Chinese students are treated equally to all British and international students, including protecting them from any undue pressure on political issues.”

Really? How? Are we going to ensure that their families in China are protected from official pressure or sanction? Are we going to monitor all their interactions with their own Government? Or perhaps these matters do not fall under the heading of “undue pressure”.

The Government’s response on supply chain resilience is little better. We are told:

“The Foreign Secretary has been clear that it is important that the UK does not become strategically dependent, and that, particularly in areas of Critical National Infrastructure, we work with reliable partners.”

So what action has followed? What exercises have been undertaken with a range of scenarios to give us a better idea of critical vulnerabilities and how these might be reduced? What specific command and control processes have been set in place to train for and respond to threats to our national resilience? Once again, we are given only vague reassurances.

The Government could and should do much better. We are dealing with an increasingly autocratic regime in China. I would have thought that our experiences with Russia over the past decade would have taught us what we should never have forgotten: how dangerous such regimes can be, especially when they are militarily powerful and, most especially, when they have nuclear weapons. We need a long-term strategy for dealing with them.

The Government should set out such a strategy. They should give some shape and sense of priority to their otherwise all too comprehensive and sometimes contradictory aspirations with regard to China. The committee has proposed such a shape. Finding a satisfactory but peaceful outcome to the Taiwan issue is at the top, but close behind it comes our pursuit of an international order that is fair to all and helps to protect the world from autocracy. Trade and wider engagement with China should be pursued, but not at the expense of higher-priority objectives, and in the knowledge that such prioritisation will at times lead to Chinese retaliation and all the associated risks.

In its leader article on China this week, the Economist said that

“handling the most powerful dictatorship in history was always going to require both strength and wisdom.”

It is not at all clear to me at the moment that we see enough of either. I hope that we can get more from the next Prime Minister, whoever that will be.

In dealing with China, I use the word to mean the Government of the People’s Republic of China, rather than the country or its people.

I acknowledge that public utterances can sometimes make a bad situation worse. We in this country have historically taken, until recently, a very cautious approach. However, there is a distinction between counterproductive megaphone diplomacy and robust public exchanges. In my experience, Chinese government interlocutors respect plain speaking rather than circumlocution. Their own official spokesmen have seldom erred on the side of reticence or understatement. Speaking in private, which has been our tradition, may or may not carry more weight than public utterances, if indeed any weight at all, depending on the circumstances. The important thing in my view is to continue to engage. As the report says, there is no realistic alternative.

It is welcome that, in their response to the report, the Government said that they would continue to co-operate and engage with China in areas of shared interest, as my noble friend Lady Anelay, said, such as climate change, biodiversity and global health. To that I would add, among other things, Russia’s threats to use nuclear weapons in Ukraine, which I believe have rung alarm bells in Beijing as elsewhere, as the noble Lord, Lord Campbell, mentioned. China has considerable political leverage with Russia, and that is clearly an area where it is worth trying to engage.

In their reply to the committee’s report, the Government rightly recognised that British interests are best served by an international rules-based order—that has always been the British Government’s position. It is proposed that the Government should play a leading role in strengthening international organisations, such as the World Trade Organization, and assembling a group of nations with sufficient aggregate political, economic and scientific power to counter that of China and successfully influence uncommitted countries. It would helpfully serve that important and laudable objective if the British Government themselves continue to uphold and treat international law as a whole and not as an à la carte menu from which to choose their own preferences. In that context, I believe it to be important that this country continues to abide by our treaty obligations under the joint declaration on the future of Hong Kong, which continue for a further 25 years, whatever the future circumstances may be and whatever China may do.

The committee rightly pointed out that, in seeking to further any of our objectives and strategic priorities, careful diplomacy would be needed and that the necessary understanding of China was neither as deep nor as widespread across government as needed. I share that perception. We live, needless to say, in straitened economic circumstances, but in the totality of government expenditure the Foreign Office budget is exiguous. We have spent time and money in the past, through the Great Britain-China Centre and other organisations, seeking to help build capacity in China in such areas as law and accountancy. We should now devote resources to building our own capacity, both linguistic and in knowledge of China’s life, history and culture across government. It is encouraging that the Government in their response to the report have recognised that.

Nor should those efforts be restricted to government employees; there should be a holistic approach across government. The education system itself should be encouraged to foster a knowledge of Chinese languages, history and culture. I speak as the modestly proud father of one who studied Mandarin at both British and Chinese universities before working in China. This should be a high priority across government. Again, it is welcome that, in their response to the report, the Government commit to strengthening people-to-people links and support Chinese language teaching and cultural exchange with China.

The noble Lord, Lord Campbell, referred to the disgraceful scenes in Manchester, which we all saw on our television screens earlier this week. In his book Experiences of China, published in 1994, the late Sir Percy Cradock recounts how after the sacking of the British embassy in Peking during the Cultural Revolution, he, bloody but unbowed, surrounded by a howling mob, quoted to his British companions in distress Virgil’s line from the Aeneid:

“forsan et haec olim meminisse iuvabit”—

perhaps even these things it will one day be a joy to recall. Perhaps we should today read a little further in the Aeneid:

“Durate, et vosmet rebus servate secundis”—

then endure for a while and live for a happier day. Or again:

“nunc animis opus, Aenea, nunc pectore firmo”—

now, Aeneas, for a bold spirit and a strong heart. The Government deserve our full support in this important and extremely difficult task of managing this relationship. We wish them well.

The report criticises the failure to provide any details on how the Government will balance plans for

“increased economic engagement … with the need to protect the UK’s wider interests and values.”

It calls on the Government to produce a “single, coherent China strategy” and warns of serious risks to our security and prosperity—including to our international trade and investments over the longer term.

This month’s government announcement that China is to be formally designated a “threat” to Britain rather than a “systemic competitor” is a belated but very welcome move towards a clearer strategy. It follows the recent warnings by Jeremy Fleming, the head of GCHQ, about the CCP’s efforts to exploit control and surveillance capabilities in emerging technologies, such as satellite location systems and digital currencies, which he said represent a “threat to us all”. I have eight questions for the Minister about specific threats to which I hope he can give us some answers today—if not, I hope he will agree to write to us.

First, during the passage of the telecommunications legislation, the Government said they would strip out 5G Huawei components from our telecom network. This removal of 5G was to happen in January 2023, with fines if the deadline was not met. Now we are told that there will be delays, even though a designated vendor direction has been issued identifying, in the Government’s words, that

“covert and malicious functionality could be embedded in Huawei’s equipment.”

When will the decision on Huawei be fully complied with?

Secondly, why have the Government, unlike the United States, still made no move to ban and remove Hikvision and Dahua cameras made in Xinjiang and used to collect data up and down the length and breadth of the UK? There is an opportunity in the Procurement Bill to remedy this. Will the Minister be able to tell us whether that opportunity will be taken at Report stage of that Bill?

Thirdly, on Monday—the noble Lord, Lord Goodlad, and others have referred to this—the Minister told us that the assault on Bob Chan, the young man at the Chinese consulate in Manchester, was “a very serious incident.” I met Bob Chan yesterday. Can the Minister tell us when the Greater Manchester Police are likely to provide a report to him and the Foreign Secretary and to spell out the consequences when the brutality for which the CCP is renowned is exported to the UK, threatening the safety of the 133,000 and more Hong Kongers who have fled to the United Kingdom under the Government’s admirable BNO resettlement scheme? I draw the Minister’s attention to a column in today’s Times, written by Jawad Iqbal, a freelance journalist, who says that what happened in Manchester was an

“affront to British democratic norms and values.”

Fourthly, the BBC reported last week that up to 30 former UK military pilots are believed to have gone to train members of China’s People’s Liberation Army, lured by the CCP with large sums of money to pass on their expertise to the Chinese military. What are we doing to address that threat?

Fifthly, with the noble Baroness, Lady Anelay, and the noble Lord, Lord Anderson of Swansea, we were in two of the Gulf states last week and were concerned to learn of joint military exercises between China, Russia and Iran. So imagine my consternation on return on reading a report in the Telegraph saying that:

“British academics have collaborated on thousands of research papers with Chinese military scientists, according to a government-funded report that universities sought to suppress.”

Some 13,415 collaborative partnerships with China, Russia and Iran were identified, and 11,611 were between Chinese and British academics. Why was the report suppressed, and what are we doing in partnerships on things as sensitive as rail gun design, hypersonic missiles and tracking systems for nuclear submarines? Why are we sharing expertise or developing partnerships to do those things?

Sixthly, despite our intelligence service publicly warning Parliament of the presence of CCP operatives and spies on our Parliamentary Estate, with one claiming that she had even secured amendments to legislation in your Lordships’ House, why has no action been taken to bring her here, for instance, to answer questions about these subversive activities?

Seventhly, in addition to subversion of UK institutions, we have seen the subversion of international institutions, with the votes of countries being bought and linked to belt and road indebtedness. How are we countering this? For instance, what will be included in the National Security Bill, currently in another place, to limit interference by people operating on behalf of the Chinese state?

Eighthly, the Minister is rightly regarded as one of this country’s leading champions of renewable energy and sustainability. What does he make of reports drawn to my attention by the noble Lord, Lord Hunt of Kings Heath, that BMW is to stop producing electric cars in England in 2023 and moving the production of electric Minis from Cowley to China? Last year, Cowley made around 40,000 electric Minis. Why are we ceding our aspirations to be a leader in global electric car manufacturing? What can be done about this? How can we avert it? I will have more to say about resilience and dependency.

Ken McCallum, MI5’s director-general, has said

“what is at risk from Chinese Communist Party aggression is … The world-leading expertise, technology, research and commercial advantage developed”

by technology companies and universities in the UK. We have to take that seriously.

In addition to threats to cybersecurity and technology, our report highlighted threats to maritime security in the Indo-Pacific region and to Taiwan, as we have heard, where we said conflict would be “catastrophic” and that

“managing this risk should be the Government’s top strategic priority.”

We raised serious maritime threats, the imposition of the national security law, the trashing of an international treaty and destruction of democracy in Hong Kong—all illustrative of the CCP’s contempt for international rules-based order—and what Michelle Bachelet recently described as “crimes against humanity” in Xinjiang in a report commissioned by the UN.

In his evidence to the committee, Charles Parton went further and said that genocide—not just crimes against humanity but outright genocide—is under way in Xinjiang. When she was Foreign Secretary, Elizabeth Truss said the same. The appalling treatment of the mainly Muslim Uighurs, which was referred to by the noble Baroness, Lady Blackstone, has included intense surveillance, much of it manufactured by Hikvision, mass detentions, forcible sterilisation and insertion of IUDs, forced migration, and the kidnapping of Uighur children, abducted from their parents and placed in state institutions, accompanied by terrible violence, torture and killing.

Both Sir Geoffrey Nice KC’s independent tribunal and the Holocaust Museum found evidence of coercive interventions by the Chinese government to prevent sizeable numbers of Uighurs from coming into being, suggesting that the deliberate goal is

“to biologically destroy the group, in whole or in substantial part.”

Nice’s tribunal concluded that this is indeed genocide.

I ask the Minister the same question that I put to George Osborne when he appeared before the committee. It was not a question about whether we should trade with countries that commit human rights violations, because we could identify countries around the world that commit human rights violations, it was: is it licit to do business as usual with a state credibly accused of genocide, which is the crime above all crimes?

In our report, we recommend that the Government

“should incorporate an atrocity prevention lens in its overall approach to trade. Current atrocity prevention tools and strategies have fallen short.”

When will the Government do this?

Then—as I said I would return to it—there is our appalling dependency on the CCP. Compare it with the clarity of its strategy of undermining resilience and security; acquiring intellectual property and data; and destroying competitiveness through slave labour in everything from green energy to surveillance equipment. One of the CCP’s reasons for wanting to destroy the freedoms of Taiwan’s 23 million people is to control the production of the world’s semiconductors—the cornerstone of modern economies. One Taiwanese company, TSMC, makes over 80% of the world’s most advanced semiconductors.

Meanwhile, further illustrating our incoherent strategy, we seriously consider allowing the sale to China of Newport Wafer Fab—our biggest producer of semiconductors. As Germany has discovered, love affairs with dictatorships come at a terrible price. Where does the sale of Newport Wafer Fab now stand?

During our inquiry, I was surprised to hear witnesses tell us how fortunate we were that China had made available invaluable help during a pandemic that had its origins in Wuhan. This included a reluctant admission that the Government had bought 1 billion lateral flow tests from China. They subsequently confirmed that they bought 24.1 billion items of personal protective equipment where China is recorded as the country of origin, at a phenomenal total cost of £10.9 billion. That is about the equivalent of the entire—reduced—British overseas aid budget.

This is not philanthropy. Increasingly, developing nations are being turned into dependent vassal states. We saw in the recent vote on the Bachelet report in the Human Rights Council that votes of those who voted with China not to even debate the report have been bought via indebted dependency. A diplomat recently said it was like having a

“1,000 pound gorilla on my back.”

Note, too, that by September, in the face of the global food crisis, China had given $10 million to the World Food Programme, compared with $5 billion from the United States of America. We see the same attempted systematic appropriation and subversion of international institutions, including the World Health Organization and the World Trade Organization.

Xi Jinping and the CCP have demonstrated time and again that they are unwilling to abide by international treaties, and that they are untrustworthy, cruel and unpredictable. This includes when it comes to the ongoing breach of the Sino-British joint declaration and the human rights crackdown in Hong Kong; the crimes against humanity or genocide taking place in Xinjiang; the launching of trade wars against countries such as Lithuania and Australia; the unlawful detention of Canadian diplomats; and the flouting of basic obligations under the WHO when it comes to sharing information regarding pandemics. Ministers could do well to look at the Biden Administration and recent legislation in the US Congress, including the CHIPS Act and the Inflation Reduction Act, to see a Government willing to invest in domestic industry, tackle climate change and reduce their dependency on authoritarian regimes.

If the West wants to protect itself, it must face up to the reality of the CCP’s history and its future intentions: executions; famine; deaths through forced labour; mass deportations; forced sterilisation and coercive abortion; purges of opponents; incarceration for dissent or unwillingness to comply with a brutal ideology—these are all the hallmarks of the CCP. With Vladimir Putin and Xi Jinping signing a declaration that there will be “no limits” to their friendship, it is crucial, as the noble Lord, Lord Campbell, reminded us, that we build our international partnerships and alliances through NATO, AUKUS and elsewhere.

To conclude, the CCP has been holding its rubber-stamp Congress. Obsessed with control—evidenced by its lockdown policy—it is veering in the direction of belligerent nationalism. But as has been demonstrated by “Tank Man” in Tiananmen Square in 1989, “Bridge Man” on the Sitong Bridge last week or Bob Chan protesting in Manchester on behalf of those who remain in Hong Kong, and by the brave people of Taiwan, Ukraine and the young women of Iran, authoritarians often overestimate their hold on power.

Liu Xiaobo, the Chinese writer and dissident and Nobel laureate, who died in 2017 after serving four prison sentences, said,

“there is no force that can put an end to the human quest for freedom”.

He was right.

The inconsistency of the UK approach to China’s aggression is itself a weakness that could be resolved in part with a strategic plan of action. Meanwhile, actions that are being taken or planned by the UK Government have a somewhat capricious, even unserious, flavour due to the lack of a stated strategy to which all tactical actions could and should be directed.

To put meat on the bones of tactics, the report and other contributions from China experts suggest a number of innovations. These include an in-depth study on the extent of the security threat posed by the PRC, to be carried out in consultation with scholars and other advisers. The current FCDO China department refers to the PRC only as a “systemic competitor”, which tends to downplay serious efforts to infringe the UK’s integrity. A programme of recruitment is needed to ensure that there is wide expertise available to the civil servants and to government departments. Given that the PRC’s ambitions, intentions and methods shift constantly, there needs to be ongoing research, consultation and policy adjustments by the China watchers as well as effective cross-government liaison and co-ordination. Interestingly, there is no reference in the Government’s response to co-ordination with European partners on trade and security policies.

The Government’s response on Taiwan is to “grow our relationship”. Once again, what is needed here is a detailed inventory of actions to support Taiwan with strong lobbying for its inclusion in relevant international organisations; a willingness to accede to requests from Taiwan for asymmetrical—or porcupine—defence weaponry; and to encourage further visits by senior ministerial, parliamentarians and other arms of government personnel.

As in other nations with questionable values and freedoms, the outreach activities tend to centre around institutional and capacity building and non-traditional security areas, such as training and joint exercises. The BBC and British Council are long established and greatly valued soft-power organisations and their role in bridging peoples across nations cannot and must not be diminished. In this context, the planned or proposed cuts to the BBC World Service are, to say the least, disheartening.

Above all, there seems to be a consensus that the UK’s China policy must avoid being dominated by profit alone.

The Government’s response to the committee’s report is, to my mind, rather too full of intentions in place of actions: for example,

“We … intend to increase our broader Defence Engagement including through capacity building and training, delivered by longer and more consistent military deployments”;

or, to give another example, the Government intend to overcome barriers to investment and point to the potential export opportunities in education, food and drink, pharmaceuticals and medical technology, without any concrete suggestions as to how this will be achieved.

Overall, the grandiose statement in the Government’s response that

“we will harness the UK’s strength as an outward-looking nation, confident in its ability to innovate, compete, lead and deliver for British businesses and the British people”,

is not always matched by diverse actions and intentions. If a coherent strategy can be agreed on which makes all the red lines clear and emphasises both the opportunities and constraints, there will be increased room for trade and soft power initiatives to achieve a much greater return.

Meanwhile, of course, China continues to be, embedded here at home right in the United Kingdom at the heart of our nuclear power replacement programme, which happens to be vital to the whole strategy of carbon reduction in the future. That is more and more important now, as our leaders realise that net zero is splendid but it will not be anything like enough to check the vast growth in emissions, coming not least from China but also from the rest of Asia, which is roaring ahead and for which entirely new policies will be needed. So here we are, dealing with and addressing an issue which is highly topical, despite this deplorable delay.

I just had one additional theme to add to the story, and indeed to the report and to the Government’s response, where it was a missing element. I refer to it in rather over-graphic terms used by one expert, who observed that China as part of its hegemonic strategy is hoovering up the developing world, and in particular the Commonwealth members of the developing world—the coastal states of Africa, but even more the islands of the global south: the South Pacific and the Caribbean as well, and indeed parts of Latin America too. This development does not get much mention from the witnesses in this report, and yet it is really the key issue in our relationship with China and the most serious threat in the medium term to our influence, to the transmission of our soft power and to our place in a transformed world with a rising Asia accounting for an increasing volume of world product activity and indeed a major contribution to security.

The most visible immediate sign of that is what has been going on in the Solomon Islands, which I think took everybody by surprise. Indeed, it seemed to me, listening to our distinguished diplomats, that they were only dimly aware that the Solomons were part of the Commonwealth, that the Queen was the Head of State and that we appointed the governor-general. However, that picture was soon asserted when we saw photographs of the Prime Minister of the Solomon Islands with the Defence Minister of China inspecting a rather grim formation of burly-looking Chinese troops on parade. Was that supposed to be what we were trying to achieve in the Solomon Islands? Rapidly, people reassessed and increased our influenced on them and realised that that is not the way we want things to go.

Then there is Vanuatu, of course, which has a huge Chinese base on it. Tuvalu has now been incorporated. Incidentally, the Solomons sit over one of the main maritime routes of the entire east Asian trade, which is a huge proportion of world trade, and the arrival of China there, and its proposal to have a nuclear base, is a matter that concerns us very much indeed.

Then we have Africa where, as we know, the Chinese have had their setbacks and are not always popular, particularly when they have used prisoners to do infrastructure work. But they call themselves Africa’s “dependable ally”, and are increasingly involved in a whole range of countries. Indeed, they have a military base in the top of Africa, in Djibouti, which is a real advance and departure. That is significant, because it brings home that we are talking about not just trade involvement—bags of gold, infrastructure, new conference centres, roads and railways and all that sort of thing—but about security co-operation. We are talking about military training, weaponry and the Sandhurst of China— the Sandhurst of Beijing, rather than the Sandhurst of Camberley—offering thousands of places for officer training to teach military values that are very different from our views of how armies should fit into democratic societies. All that is going on, almost—and I hope that I will be forgiven for saying this—with an oblivious disregard from our policymakers here about what is really happening.

That is the global south—and then we have the Caribbean, of course. I know that Barbados has not left the Commonwealth, although the media think that it has, because it has ceased to be a realm. They are very confused and do not actually understand what is happening in the Commonwealth at all. But those who went there tell me that, as they left, large jumbo planes were arriving and parking at the airport, covered in Chinese designations and signs. It turns out that the Barbadian Government have become dangerously involved, as have many other countries, in owing China a large amount of money for what they thought were grants, which turned out to be loans. They are going to cause a lot of grief when they have to be repaid.

So here is a picture of our Commonwealth of like-minded countries, which are privileged to be members of it—and it is one of the main sources of our transmission and influence in the world. We would like to think that it would be a chain of liberty and democracy containing China, but almost before our eyes it is being turned on its head into a chain of Chinese projection of its power, instead of a containment of its power. It is a very serious development, not mentioned here and not mentioned by the Foreign Office; it is not understood, and it is coming into our lives in very serious ways and at great speed.

We have, of course, huge involvement in south Asia. We have our involvement in Five Eyes and the Five Power system, which was mentioned very thoroughly in the report. We have our links with Japan, which are again covered in the report, and we have AUKUS and the submarine plans, which are important. We have our ambitions to join the CPTPP. We are not involved in the RCEP. All these are organisations far larger than the European market, and far more important in the long term for our development.

We have that; versus that, we have a China which at a very deliberate, practical and detailed level—with not too much ideology but in detail—is constantly moving from island to island and state to state. China is arranging not only the links that I talked about earlier but also technology links and opportunities that they can use as basis for GPS, which we are told is part of the next war, in space, and for drone development, which you do not need on a small island, for a large airport with a large airstrip, and for a whole range of other technologies controlling maritime movements through the continental shelf and the UN’s law of the sea provisions of immense strategic value.

I was saddened to hear from a leading Foreign Office expert a year or so ago that the Commonwealth was a bit boring; it was much-loved by the late Queen, but these little islands were very remote and of no strategic significance. The Chinese do not think that; they think the opposite. They think they are of high strategic significance, and they are involving themselves in these nations at a great rate and in many very effective, soft-power types of ways. I wanted to add that missing bit to our debate, to the Government’s response and to the report, because it is the most important bit of all.

I wish we could have a strategy and framework, which noble Lords with huge expertise are calling for, but I do not think it will be like that. The pace of change of events is enormous, and we have to, at best, try to fit in with the hard cop, soft cop pattern. We need to be hard cop.

We listened to the noble Lord, Lord Alton, with his ceaseless and superb indications of the nasty, illiberal side of China, and what it is doing to people in thuggish ways—there was a little demonstration of that in Manchester last week, which I thought was very interesting. These are Chinese thugs at work; we know that this is a streak in the Chinese character. We have to listen to Xi claiming his endless term of office and talking, frankly, ideological rubbish about how we must go back to Marx and Leninism. He has issued his own absurd “Little Red Book”. The Chinese are not fools; I do not know how they will tolerate that sort of thing, but I do not think that it will last.

We have to be the hard cop there, but we also have to be the soft cop, because China is a world leader in technology, it is a decisive part of the world economy—I understand that China is the second-largest source of imports to this country—and it is embedded in our nuclear power, as I said earlier, and indeed in many other aspects of our infrastructure, partly as a result of being perhaps overencouraged 10 years ago. As noble Lords have rightly said, the world has changed radically. We now have to look at China with the scales dropped from our eyes and realise that we have to deal with it—while holding our noses—but that it is also, potentially, an increasingly dangerous threat to the order of a democratic, free world.