Diplomacy, delayed semiconductor strategy, TikTok
A Beijing to Britain briefing
Hello-ho-ho,
"Globalization and free trade are almost dead," mused Morris Chang, founder of Taiwan Semiconductor Manufacturing Co, this week. The so-called “father of Taiwan's chip industry” was joined in Arizona by America’s President Joe Biden, and the chief executives of Apple and Nvidia, two of TSMC’s biggest customers, as the semiconductor firm announced it will more than triple its investment in a giant plant in the United States to $40bn. Thanking the company for its investment, Biden told those gathered “Thousands of Arizonans are going to be able to look their kid in the eye because of what you’re doing here today and saying, “Honey, it’s going to be okay” and mean it.” Meanwhile, Bloomberg reported earlier in the week that Dutch officials are planning new controls on exports of chipmaking equipment to China, potentially as soon as next month.
In contrast, on Monday the British Government announced it would be spending just under one million pounds on an exciting new research project. Downing Street is looking into the feasibility of creating “a new national institution [that] could be established as part of plans to boost the infrastructure underpinning the UK’s industry through the government’s upcoming semiconductor strategy.” With a start date of February next year and a planned 7-month duration, it should culminate towards the end of summer 2023. That would be fine, except the Semiconductor Strategy was due before Christmas this year, the current draft of the strategy has been described to me as looking like something that could have been put together by a regular reader of The Economist, and the new ‘research project’ is for all intents and purposes asking a third-party to write the entire thing from scratch anyway.
What purpose does a strategy document actually serve? In short, it acts as a roadmap for Government and business, providing a clear view of desired outcomes, and ideally a plan on how to get there. Several strategies and plans are now overdue, and given the areas some of these cover - international technology and quantum computing being just two - the lack of clear direction and thinking on these matters is beginning to become a national security concern.
🎶 On the first day of Christmas, my true love gave to me - a further delay to the Semiconductor Strateg-eeeey 🎶 Anyone? No-one?
Finally - this will be the last regular briefing of 2022. What a year! Personal highlights for me include providing full transcripts of both potential Prime Minister’s China pitches over the summer when no other outlet did, being the only source to give you an inside track of the Foreign Affairs Committee election, and routinely gathering intel on a Parliament and multiple Governments in a state of flux. 2023 looks set to be just as busy, and China is not going anywhere.
Ultimately, Beijing to Britain is powered by its paying readers, and I’m incredibly grateful to those of you who support this project. If you have learned something new from my research and intelligence gathering over the last 12 months, please consider becoming a paying reader to help keep this show on the road.
— Sam Hogg, Editor
Order! Order!
Some of the more eye-catching questions and tweets from Westminster dwellers this week
Lord Bert (Crossbench) asked “what assessment they have made of the risk of new COVID-19 variants emerging in China.”
Alicia Kearns (Chair, Foreign Affairs Committee, Conservative) tweeted “Newspaper owner Jimmy Lai sentenced to 5 years and 9 months for fraud in a political witch trial to hunt down dissent from the CCP regime. Jimmy is a British citizen and must receive vocal support from HMG. Serious questions to be answered by foreign judges in Hong Kong.”
Tom Tugendhat (Security Minister, Conservative) tweeted “This is well worth listening to. @dansenor interviews Matt Pottinger on the changes we’re seeing in China. https://t.co/2GpcGpu1oe”
Politics
Diplomacy latest
Global Britain in action
The past week has been a busy one for British diplomacy, with the UK engaging with international partners on issues ranging from defence to protecting communications supply chains. Although mostly unmentioned, concern about China appears to have loomed over many of these meetings and their outcomes. To gain a fuller understanding of the week's events, it is helpful to break them down day by day.
Monday
The British Government announced Sarah Tiffin had been appointed Ambassador to the Association of Southeast Asian Nations (ASEAN) in Jakarta. Power couple alert: she’s married to Pádraig Francis, Ambassador of Ireland to Indonesia and to ASEAN.
The Government also announced Dr Christian Turner CMG had been appointed to a senior diplomatic position in London as Director General Geopolitical (Political Director) at the Foreign Office. This position is equivalent to Under Secretary of State.
Tuesday
Deputy Secretary of Defense Dr. Kathleen Hicks and UK Permanent Under Secretary of Defence David Williams met at the Pentagon. The pair discussed “U.S.-UK nuclear collaboration, industrial base issues related to Russia's invasion of Ukraine, lowering information-sharing barriers, and the upcoming U.S.-UK Defense Dialogue.” They also mulled over the following day’s AUKUS meeting. No explicit mention of China, although Hicks later went on to give a fascinating interview which touched on Beijing and Taiwan at length.
Admiral Sir Tony Radakin KCB ADC was also in DC. The Chief of the Defence Staff appeared onstage at a Wall Street Journal event with his counterpart General Milley, where they discussed Russia and China.
Wednesday
Defence Secretary Ben Wallace met with US Secretary of Defense Lloyd Austin and Deputy Prime Minister and Defence Minister of Australia Richard Marles for the inaugural meeting of AUKUS defence ministers. Gathered in the Pentagon, the trio “reiterated their shared commitment to the partnership and reviewed progress on identifying a conventionally armed, nuclear‑powered submarine for the Royal Australian Navy.” There was also an agreement that all three countries would undertake military exercises over the next two years together. Wallace said: “This first trilateral meeting is a landmark moment in the AUKUS partnership. AUKUS reflects the unique level of trust and cooperation the UK shares with its US and Australian partners, and I look forward to enhancing our technologies and capabilities together.”
Foreign Secretary James Cleverly arrived in Kenya as part of a multi-country visit to the continent. In his opening speech, Cleverly had a dig at Chinese BRI investment in the continent, stating “We hugely value working with our allies and friends across Africa. Such relationships benefit us all. The UK offers honest, reliable investment that does not load countries with debt, but instead unlocks huge potential for economic growth, while boosting global health and tackling climate change.” The trips is part of the Foreign Secretary’s recent and poorly articulated vision to reshape the UK’s relationship with Africa - watch this space.
The UK and Japan unveiled details of a new digital partnership “to turbocharge their joint working in an era of increasing global competition on tech and data.” This will see both countries structure engagement on a range of digital issues, including how to improve the resilience of globally significant supply chains such as semiconductors and telecommunications. The countries will develop joint research and development initiatives to share expertise about these vital technologies. Analysts paint this agreement as an effort by both Governments to diversify chip supply chains away from Taiwan, and perhaps for Tokyo and London to “become a dual leader in the industry.”
Trade Minister Greg Hands kicked off a multi-state tour of the US “to boost trade and investment ties with individual states.” Starting in Columbia, South Carolina, Hands covered three states in four days: South Carolina, California and Utah. The UK signed a Memorandum of Understanding (MoU) with South Caroline.
Thursday
Australia, Canada and the United States back guidelines for telecoms companies, developed by the UK, “designed to build a more innovative, competitive and secure supply of equipment for telecoms networks, including for 5G and 6G.” Clearly aimed at limiting the role companies like Huawei play across the world, the statement set out the four countries' commitment to working together to build a stronger and more resilient 5G supply chain, including through the development of alternative sources of supply and the promotion of open and fair competition. Digital Infrastructure Minister Julia Lopez said: “The UK has set out a blueprint for telecoms firms across the world to design more open and secure networks. With the endorsement of Australia, Canada and the United States, the industry now has the clarity it needs to deliver a new generation of wireless infrastructure fit for the future.” It’s worth remembering in these conversations about the future of the Internet, 4G, 5G, 6G etc., that 37% of the world’s population, 2.9 billion people, have never used the Internet. Of this 2.9 billion, an estimated 96% live in developing countries.
Foreign Secretary James Cleverly arrived in Ethiopia, and discussed the UK’s aid to the country. Word reaches Beijing to Britan that he is due to give a significant speech on Monday, outlining his foreign policy views.
Friday
Prime Minister Rishi Sunak, Prime Minister Giorgia Meloni of Italy and Prime Minister Fumio Kishida of Japan put out a Joint Statement on the Global Combat Air Programme (GCAP). The trio expressed their commitment to work together to address global challenges and promote international cooperation. The Prime Ministers discussed climate change, trade, and security, and pledged to support each other in their efforts to address these challenges. Crucially, they announced the Global Combat Air Programme (GCAP) – an endeavour to develop a next-generation fighter aircraft by 2035. Good Twitter thread here from Alessio Patalano, Professor of War & Strategy in East Asia at King’s College London. Speaking about the statement, Sunak said: “The security of the United Kingdom, both today and for future generations, will always be of paramount importance to this Government. That’s why we need to stay at the cutting-edge of advancements in defence technology – outpacing and out-manoeuvring those who seek to do us harm. The international partnership we have announced today with Italy and Japan aims to do just that, underlining that the security of the Euro-Atlantic and Indo-Pacific regions are indivisible. The next-generation of combat aircraft we design will protect us and our allies around the world by harnessing the strength of our world-beating defence industry – creating jobs while saving lives.”
The UK kicked off the process to begin upgrading its trade deal with South Korea. Note the heavy geopolitical twist on the press release, which said “South Korea is the 10th largest economy in the world and a top-three global producer of vital goods such as semiconductors and ships. In an increasingly unstable world, boosting trade with a like-minded democracy, and trusted ally, will improve our security and resilience.” Total UK exports to South Korea were £10.2 billion in the year to Q2 2022.
However, Global Britain’s climate change leadership and legitimacy suffered a setback this week when the Government announced plans for a new coal mine for steelmaking. As readers may recall, Minister for the Indo-Pacific Anne-Marie Trevelyan recently returned from a tour of the Indo-Pacific region, a part of the world on the frontline of the fight against climate change, which naturally featured heavily in her remarks. So the news that the UK will be opening a new coal mine was met with a negative response from many of those regional partners, analysts, and leaders. Frank Bainimarama, the Prime Minister of Fiji, tweeted: "Is this the future we fought for under the Glasgow Pact? Fossil fuels should be phased OUT - not up." Angelique Pouponneau, an adviser to small islands at climate talks from the Seychelles, tweeted: “Huh? Confused – just a few weeks ago we heard 1.5 was on life support…”, and regional journalist Michael Field (of
) added, “Britain's climate change new solidarity with South Pacific nations turns out to be worthless.” It is worth noting that 85% of the coal produced by the mine would be exported, despite the Government (and some friendly press) framing it as a chance to reduce energy reliance on global actors.