Government is ‘making up China policy as it goes’, MPs have warned in new report

MPs accuse the Labour government of failing to deliver its 2024 promise of a “strategic, long-term, consistent” approach to China. They say ministers are making policy reactively, rather than setting clear rules in advance. This matters because businesses and security officials need predictable decisions when dealing with a major economic partner.

The committee points to several signs of this problem. These include the last-minute blocking of Chinese firm Ming Yang’s wind-turbine factory plans in Scotland, concerns about re-engagement with Beijing before publishing a strategy, and an unpublished China relations audit completed in June 2025. MPs call the overall record reactive, inconsistent and opaque.

They also warn that diplomatic politeness can take priority over national security. The report says this exposes Britain to unquantified, unmanaged risks, including sensitive technology transfers and dependence on Chinese supply chains. MPs want clear economic zones, stronger safeguards and rules with real enforcement.

A strategic, long-term, consistent China policy would set clear objectives and rules for years ahead. It would balance economic opportunities with national security, rather than treating each Chinese investment or diplomatic issue as a separate emergency. Businesses could then plan with greater confidence, while officials could apply the same tests across sectors.

In practice, the policy would identify sensitive areas, define acceptable forms of engagement and explain how risks must be reduced. The committee recommends “red zones” off limits to Chinese trade and investment, alongside areas where engagement is allowed with safeguards. It also supports green zones where trade is fully permitted and encouraged.

The article says the Government promised this approach in 2024 but has not delivered it. MPs criticised re-engagement with Beijing before publishing a strategy, despite completing an audit in June 2025. Their proposed framework aims to replace last-minute decisions with advance planning and enforceable rules.

The article says ministers blocked plans by Chinese firm Ming Yang to build a wind-turbine factory in Scotland because of security concerns. It presents the decision as an example of the Government’s reactive approach, because the intervention came at the last minute. The decision shows how uncertainty can emerge after companies have already made plans.

The article does not specify exactly which threat officials identified in the Ming Yang case. More generally, the committee warns about the transfer of sensitive data and technologies, economic dependence on Chinese supply chains and risks linked to strategically important infrastructure. Those wider concerns help explain why some investments may receive heightened scrutiny.

MPs argue that the episode should not be managed through sudden interventions alone. They want the Government to define red zones and other categories beforehand, so businesses understand which activities are prohibited, which require safeguards and which are encouraged. That would make security decisions clearer and less disruptive.

Delayed or inconsistent decisions create uncertainty on both sides. UK businesses may postpone investment, miss opportunities or enter markets without knowing whether rules will change later. The committee says the lack of clear guidance directly hinders commercial decisions about China. That uncertainty can weaken Britain’s ability to compete and plan.

National security risks can also accumulate before ministers act. The report highlights possible transfers of sensitive data and technologies, as well as dependence on Chinese supply chains. The last-minute blocking of Ming Yang’s proposed Scottish factory illustrates the disruption caused when security concerns are addressed only after plans have advanced.

The committee describes the resulting exposure as “unquantified, unmanaged risk”. It recommends clearer red, restricted and green economic zones, supply-chain protections and rules against forced-labour imports. It also proposes a tariff regime if China refuses fairer economic conditions. These steps would make risks more visible and responses more predictable.

The article gives no figures for the UK’s trade with China, Chinese investment in Britain, technology dependence or the share of essential goods from Chinese supply chains. Therefore, its scale cannot be measured precisely from the supplied text. The report instead describes the problem in terms of risks that require clearer management.

Its warnings cover several connected areas. Economic dependence could leave Britain vulnerable if Chinese supply chains are disrupted or used for leverage. Sensitive data and technologies could be transferred through commercial relationships. Chinese investment may also raise security questions in strategically important sectors, as shown by the Ming Yang factory decision.

The committee’s proposed response is not to end all trade. It wants red zones for prohibited activities, risk-managed areas for permitted engagement and green zones where trade is encouraged. It also recommends stronger supply chains and possible tariffs if China refuses reciprocal market access or continues unfair subsidies.

A zone system would let Britain separate safe commercial engagement from activity that could threaten national security. Red zones would cover parts of the economy that should be off limits to Chinese trade and investment. Green zones would cover areas where trade is fully permitted and encouraged. A middle, amber-style category would manage activities that are allowed only after risks are reduced.

The article explicitly recommends red zones and green zones, plus categories where economic engagement is permitted subject to risk mitigation. It does not itself use the word “amber”, but that middle category matches the proposed risk-managed approach. Safeguards could address issues such as sensitive data, technology transfers or supply-chain exposure.

This framework would avoid both blanket openness and a total trade ban. It would give companies clearer boundaries while allowing beneficial commerce to continue. MPs also propose stronger supply chains, forced-labour import bans and possible tariffs when China fails to offer fair, reciprocal access.

Economic security is the protection of a country’s economic strength and resilience from serious external risks. It includes keeping essential supply chains reliable, protecting sensitive data and technology, and avoiding dependencies that could leave national decisions vulnerable. It matters because economic systems support critical services, industrial capacity and national security.

The article warns that close economic ties with China could expose Britain to technology and data transfers or excessive reliance on Chinese supply chains. If important goods, components or capabilities depend heavily on one country, disruption or political pressure could affect Britain’s ability to operate. The article does not identify specific products or quantify this dependence.

MPs therefore call for stronger supply chains and clearer limits on investment and trade. They also recommend banning goods made with forced labour and preparing tariffs if China continues unfair subsidies or refuses reciprocal access. Their aim is selective engagement: welcome trade that strengthens Britain, and stop trade that creates unacceptable risks.