Commentary on Political Economy

Saturday, 4 July 2020

From pizza to pipelines: how Beijing’s tentacles stretch into every aspect of our lives

Yuan for the road: Cameron and Xi enjoy a pint in 2015
Yuan for the road: Cameron and Xi enjoy a pint in 2015
You run a shower. You boil the kettle. You catch a train to work. You chat on a Zoom call. You watch a Premier League match. You drink a pint at the pub that has reopened for the first time in three months, followed by a meal at Pizza Express.
Between 2000 and 2019, Chinese investment worth £50.3bn flowed into Britain, dwarfing the sums pumped into Germany and Italy, the next biggest recipients.
As a result, at every stage of a fairly typical day in Britain, you will brush up against China and its growing influence. The regime’s tendrils are impossible to escape.
● Start with that morning shower. China Investment Corporation, the country’s sovereign wealth fund, bought a 9% stake in Thames Water in 2012. In 2016 it bought a chunk of National Grid’s gas pipelines.
CK Hutchison, founded by Li Ka-shing, a Hong Kong billionaire who has a complex relationship with Beijing, owns Northumbrian Water and UK Power Networks, which supplies electricity to London. China General Nuclear still hopes to build reactors at Bradwell on the Essex coast.
● Next, to the office, possibly on a train run by Eversholt, which owns about a quarter of Britain’s trains. CK Hutchison controls Eversholt.
Maybe you’re going by road: the Bank of China was among a pack of lenders that propped up the struggling car-maker Jaguar Land Rover with £560m of loans after delays obtaining cash from the UK government.
● En route, you send an email with your Huawei smartphone. Boris Johnson is considering reversing a decision to allow the Chinese telecoms giant a role in building Britain’s 5G mobile network, but Huawei has been embedded in Britain since 2005. Its founder, Ren Zhengfei, was an officer in the People’s Liberation Army.
China has even opened a television station in Chiswick in west London — which has been sanctioned by the watchdog Ofcom for biased coverage of pro-democracy protests in Hong Kong.
● Your office may well be Chinese: London skyscrapers including the Cheesegrater (the Leadenhall Building) and the Walkie Talkie (20 Fenchurch Street) are owned by Chinese investors.
● If you’re studying, Chinese money could have subsidised your education. When funds dried up after the financial crisis, universities from the London School of Economics to Cambridge welcomed Chinese investment. The number of Chinese students, who pay up to three times the fees of UK students, has risen by a third in five years. And Confucius Institutes, named after the philosopher, have sprouted at UK universities.
● At the weekend, maybe you’ll take in a football match. Wolverhampton Wanderers are owned by Fosun International, a Chinese conglomerate. Arsenal counts Zoom as a sponsor — it was founded by the Chinese-American businessman Eric Yuan.
Supping your pre-match pint in a Greene King pub? The chain was bought in 2019 by CK Hutchison. In 2015, David Cameron shared a pint with President Xi Jinping at the Plough at Cadsden, in Buckinghamshire (a pub later bought by a Chinese firm).
● You might decide to go for an American Hot after the match: Pizza Express is owned by Chinese private equity firm Hony Capital.
● And don’t think a holiday is going to get you away from it all. China Investment Corporation bought a 10% stake in Heathrow in 2012. And Fosun owns Club Med and the remains of the tour operator Thomas Cook.
John Collingridge is Deputy Business Editor

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