Commentary on Political Economy

Thursday 28 March 2024

 Britain was hoodwinked by all-seeing China

After compromising our national security in pursuit of economic opportunity, it’s time to unwind this relationship

Juliet Samuel @CITYSAMUEL

Chinese students are in this country to learn specific, strategically useful skills

At what point, do you think, will our diplomats and bean counters realise they have been honeytrapped? At least in terms of the UK’s political economy. For years, they have sold us the story of China as the great opportunity for Britain.

First, Beijing was the miraculous source of ultra-cheap technology to help us to cut costs. Then it became a fount of essentially free money to fund mega-investments. And then we were told the Chinese market was the great hope for high-value British service exports on a vast scale, despite the numerous barriers. Only now are we starting to count the cost of these illusions.

During a statement in parliament this week, the government admitted, 18 months after the fact, that a Beijing-linked hacking group spent more than a year mining data inside the computer systems of the Electoral Commission and has carried on a voracious campaign of hacking and digital impersonation targeting MPs and activists critical of the Chinese Communist Party.

The United States, New Zealand and Finland identified similar nefarious activities by Beijing-backed hackers. Given the usual prostrate stance of our officials before CCP outrages, one wonders if the UK would have gone this far if it hadn’t been for our allies making the same noises.

Still, the statement in parliament marks a break. Usually, the voices of Sino-sceptical ministers, such as Oliver Dowden and Tom Tugendhat, get ignored in favour of the Beijingbewitched.

Where measures are taken, they often add up to less than the sum of their parts. Telecoms companies, for example, were meant to finish stripping dodgy Huawei kit out of Britain’s core networks by January last year — an exercise performed at vast cost that rather undermines the original cheap-as-chips rationale for installing it. But they missed that deadline and it was extended to December. Did they meet the more generous cut-off? Of course not.

Likewise, Dowden announced to much fanfare last year that CCTV cameras made by the Chinese surveillance company Hikvision would be banned from sensitive sites in the UK. Months later, it emerged that the company had received a letter clarifying that this didn’t include police stations or other government sites outside defence and intelligence locations. In the US, Hikvision is among several Chinese camera companies whose kit is now banned from import or sale.

Sino-sceptical voices are ignored in favour of the Beijing-bewitched

Then there is the National Security Act. The legislation was passed in July with a key piece missing on the grounds that the government needed time to establish its new “foreign influence register”. The scheme is modelled on an Australian precedent and establishes a register that, in its “enhanced” tier, makes it illegal for anyone — a British academic also paid by a Chinese university, say, or a consultant for Huawei — to hide their affiliation to a designated foreign entity. This would make it easier to force Beijing’s meddling into the open and penalise duplicity, doing away with the legal grey area in which much of this activity takes place.

The idea is to counter the CCP’s particular mode of intelligencegathering and interference. Unlike more resource-constrained surveillance states, Beijing applies its domestic mass-surveillance model globally, mopping up vast troves of information. According to US officials, a single hacking group sent out more than 10,000 phishing emails in just three months of 2018.

This explains why Chinese hackers and spies would target the electoral register, on its own a rather anodyne database. Such data is used for everything from recruiting scientists to harassing dissidents, hiring former mandarins, lobbying our politicians, censoring scholars and stealing business secrets or technology.

Yet, despite designing its register to counter this threat, the government is hesitating to apply it to China.

Treasury and trade officials worry that implementing it will hinder business links. Foreign Office officials fret that it will upset their Chinese contacts, who will no doubt try to hire them on unimaginable salaries as soon as they leave His Majesty’s service. Nor will they countenance the idea of passing an updated Treason Act to outlaw the activities of those former officials trying to recruit or exploit their old colleagues on behalf of a foreign power. Presumably, their preferred solution is that Britain simply put up with it all — no pain, no gain.

No matter how many times this approach is debunked, Whitehall reasoning is applied to green tech, Chinese students, science and every other trade-off against national security. The next free lunch we’re to be sold will be a wave of cheap electric cars from China’s ultrasubsidised factories, undoubtedly packed with spyware and sending all their data back to Beijing, as experts such as Charles Parton have warned.

After all, they’ll say, the UK has set itself a wildly ambitious deadline for phasing out the combustion engine.

How are we to meet it without some sacrifices? And who will be there to argue for tariffs or privacy requirements, given that Beijing’s biggest electric vehicle firm, BYD, has pre-emptively joined the UK’s premier carmakers’ lobby group? As for Chinese students, the largest cohort of foreign fee-payers propping up our universities, they are usually touted as an example of Britain exporting its wonderful values and services to China’s next generation.

This too is wishful thinking. Chinese students in this country are put under strict surveillance by the CCP and can be forced to report upon fellow students, activists and professors, making for a whole pool of potentially coerced agents.

They are sent here to gain specific skills deemed strategically useful to the CCP. Their financial importance has been used repeatedly by the Chinese embassy to try to censor campus debate, while their networks no doubt aid Beijing’s recruitment of UK scientists and technical experts.

This doesn’t mean we should ban them all, but it’s only sensible to impose conditions, such as requiring universities to integrate foreign and domestic students, avoiding separate residence halls, for example; to monitor and limit foreign political activities, such as CCP scholar association gatherings on campus; and to limit access to certain subject areas, such as artificial intelligence or image recognition. But even such basic precautions would no doubt engender howls of outrage from the powerful higher-education lobby, usually led by an accusation of racism and relentlessly pandered to by their civil service peers.

The truth is that the era of free lunches is over: it is now time to count the costs and pay the tab.

China may be an inescapable fact of the global economy, but this makes self-defensive measures more, not less, necessary. For the rump of powerful government officials still in denial, it is time to move on.

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