No return of ‘golden era’ with China despite Cameron comeback, insists Sunak

Rishi Sunak has insisted that Britain’s relationship with China has changed since Lord Cameron hailed a “golden era” of closer economic ties, even as ministers said they welcomed more investment from Beijing.

Mr Sunak vowed to “protect” British assets from potential Chinese security threats but said it was also important to “engage” with the world’s second-largest economy.

Lord Cameron, who was prime minister between 2010 and 2016, has been forced to defend his pro-China stance following his shock appointment as foreign secretary.

The appointment has also led to speculation of a thawing of UK-China relations. However, Mr Sunak said the Government’s position towards Beijing had changed since Lord Cameron’s tenure in Downing Street.

Mr Sunak told delegates at the Global Investment Summit in London: “I think if David was here, what he would say is that China today is not the China he dealt with over a decade ago. It has changed and it’s right that our strategy evolves to take account of that”.

Mr Sunak, who met dozens of global chief executives and investors at the summit in Hampton Court before hosting a dinner at Buckingham Palace with King Charles, described the current approach towards Beijing as “protect, align and engage”.

Citing the new National Security and Investment Act which was used to block the takeover of the UK’s biggest chip plant, Newport Wafer Fab, last year, Mr Sunak said: “You’ve got to protect the UK against the risks where they manifest themselves,” suggesting Downing Street would continue to “block investment in sectors if we’re not comfortable with it”.

He added that the UK would continue to “align” its national security policies with allies like the US going forward, but added it was also important to maintain a dialogue with Beijing, including on areas such as climate change, public health, advances in artificial intelligence and the global economy.

China and India are expected to drive most global growth next year as many major economies, including the UK and Germany stagnate.

“Whether you like it or not, China is an indisputable fact of global economic life,” Mr Sunak said. “There’s no solution to the world’s biggest problems … without engaging with China.

“And if [we’ve] taken the steps you need to protect yourselves, then [we] should be able to engage with confidence for the benefit of our country.”

Mr Sunak has stopped short of branding China a threat since becoming prime minister last year, despite demands from Tory backbenchers. His predecessor Liz Truss has challenged Downing Street to deliver on pledges made last summer to clamp down on Beijing.

Spying allegations linked to a parliamentary researcher in September have also sparked concerns about Chinese espionage in the UK.

US national security officials are also vetting a string of takeovers by Abu Dhabi amid fears about its growing ties to China.

Economic links between the two nations have alarmed American officials amid a surge of Gulf investment into China, which has grown from $100m (£80m) last year to $2.3bn so far in 2023.

Mr Sunak told the audience of bankers and investors that the UK was focused on “strengthening our alliances in every part of the world”.

He said: “The economic geography of the world is changing. And so for a country like the UK, it’s important that we reorient ourselves to places like the Middle East and Asia Pacific, which all those alliances speak to.”

Speaking to reporters, Lord Johnson, the investment minister, also described Chinese investment as “crucial if we’re to achieve our net zero goals”. He added that the United Arab Emirates was a “great ally and partner”.

A number of Chinese investors were invited to Monday’s summit, including offshore wind manufacturers and several car makers.

Lord Johnson said he hoped to “attract another Chinese car manufacturer” to the UK.

Geely, which already owns Volvo and makes London’s black taxis, launched a new UK headquartered company with French manufacturer Renault earlier this year that plans to invest billions of pounds in developing low emission petrol, diesel and hybrid engines.

However, Lord Johnson conceded that the UK would continue to guard its intellectual property (IP).

He said: “Certainly in very specific technologies we are quite keen to keep them jealously guarded from any international investor. And I think that’s absolutely right.

“We need to have real ownership of commercialising this IP at the very highest level …because if we don’t have that we don’t have control over it.”