A British parliamentary committee urged clearer rules for China-related trade and investment, saying uncertainty hampers business planning and successive governments have not reassured the public, Parliament or security community that safeguards are adequate.
The House of Commons Business, Innovation, Science and Trade Committee proposed a three-tier system: prohibit activity it considers off limits, require safeguards where risks can be managed, and permit low-risk trade. It also recommended publishing China policy objectives, clarifying which ministers are responsible and reporting progress to Parliament each year.
The committee said Labour governments since the 2024 general election had promised a strategic, long-term and consistent approach, but had not given businesses and officials clear guidance. It also described policymaking as spread across departments without clear accountability.
On the China audit, the report says the government completed it in June 2025 but did not publish it. In a June 24, 2025, statement, then-Foreign Secretary David Lammy described the audit as ongoing and said much of its detail was classified.
The committee calculated UK trade with China at £107.2 billion and trade with Hong Kong at £32.3 billion over the four quarters to the end of Q1 2026, for a combined £139.5 billion. The report says lower-cost Chinese imports can benefit UK consumers, while subsidized competition may put British businesses and jobs at risk. It adds that UK firms seek access to Chinese markets and innovation, while dependence can expose the country to coercion, disruption and security risks.
The report compares today’s advanced-industry competition with the “China Shock” of the early 2000s and calls the current wave “China Shock 2.0.” The committee says the earlier period brought consumers lower-cost goods but also contributed to job and wage losses and reduced research spending in some UK industries.
Committee Chair Liam Byrne said businesses could not plan for the future while the government kept changing its China policy. The government has two months to respond to the report.
