British business sentiment, BGI Group, semiconductor feedback, G7 in Commons
A Beijing to Britain briefing
Hello,
The third pillar of the UK’s newly minted three-pronged China approach is ‘engage’. In his unprecedented speech on the issue last month, Foreign Secretary James Cleverly stated the UK wants to ‘engage’ with China “bilaterally and multilaterally, to preserve and create open, constructive and stable relations, reflecting China's global importance.” This, he argued, also meant that the Government wanted “British companies to do business in China … [and] will support their efforts to make the terms work for both sides, pushing for a level playing field and fairer competition.” But what is the situation actually looking like for these British businesses trying to operate in China?
As this year’s British Chamber of Commerce in China (BCCC) sentiment paper reports - it’s not looking too rosy. In a new record in the organisation’s polling history, 42% of British businesses reported a pessimistic outlook for the China market last year, surpassing 10% for the first time ever. As we explore later, BCCC members put this down to a number of issues, ranging from geopolitics to ease of doing business, and we get a handy sector-by-sector overview of the key issues they face. Oddly, despite the fact that many MPs have spent the last couple of years discussing, chastising or pushing for closer scrutiny of British investment in China, few seemed to have really engaged with any of the report’s findings, or acknowledged it was even published. Indeed, as much as Twitter is a useful barometer for seeing what politicians are reading and digesting (and I hold the view that it is somewhat, given many China hawk MPs like to tweet what they read), not a single MP tweeted about the BCCC report at all.
It will be worth seeing if the report’s industry-by-industry findings permeate into Westminster at all. Scan through Hansard, and it’s clear that MPs tend to hold quite vague views around what the biggest challenges facing British businesses in China are - supply chain transparency and due diligence, CCP interference, and IP theft all come up fairly often. While these are all clearly issues that exist, if Parliament wants to step up its scrutiny of how successful the Government’s ‘engage’ pillar is going to be, it also needs to get smart on what issues British businesses are facing now, and what they are asking for.
In a similar vein, and acknowledging that using Twitter as a barometer for interest does have its flaws, it was fascinating to see that only one MP tweeted about the latest Foreign Office assessment of the situation in Hong Kong. The report, which we unpack further down today’s briefing, re-states that the Chinese Government is in “a state of ongoing non-compliance” with regard to the Sino-British Joint Declaration. Labour’s Shadow Minister for Asia, Catherine West, was the only MP to share it with their followers. Just two years ago, the silence on social media from Westminster on a Hong Kong issue like this would have been unimaginable.
Finally, I’m including a link to a (very late at night and therefore poorly attended) debate in the Commons this week on artificial intelligence. Labour’s star on the rise Darren Jones MP brought it forward, and it’s worth skimming to give an early sense of where backbench politicians view China’s position in the system, especially given this is a subject area - in my view - that will come to dominate British politics in the coming three years.
As Parliament is in recess, there will be no Beijing to Britain next week.
— Sam Hogg, Editor
In this week’s Briefing Note, we look at:
G7 statement and questions in Parliament
British business sentiment in China
BGI Group complaints