Politics and Diplomacy
In 2024, tensions between China and the United Kingdom in the political and diplomatic spheres continue to intensify. In the field of technology, the British government remains vigilant towards Chinese companies.
In May 2024, the UK National Security Council released a new report pointing out that activities by Chinese companies in artificial intelligence, 5G networks, and quantum technology pose potential threats to the UK. The UK announced further restrictions on Chinese investments in these critical areas.
According to the report’s data, the UK had already rejected at least 10 high-tech acquisition deals involving Chinese capital in 2024, with a total value exceeding £1.2 billion.
Although there have been fluctuations, Sino-British bilateral trade remains at a relatively high level.
In the first six months of this year, the total trade volume between the two countries reached £52 billion, down approximately 3% year-on-year. The UK’s exports to China amounted to £16 billion, mainly concentrated in aerospace equipment and pharmaceutical products.
In August, The Guardian revealed a new espionage allegation, claiming that a consultant who had previously worked for the British government was suspected of leaking sensitive information to China.
Although the case is still under investigation, it has sparked widespread discussion in British society.
Polls show that 68% of Britons believe the government should take a tougher stance on China, with nearly half supporting further restrictions on Chinese investments in the UK.
In July 2024, the Chinese government announced that it would strengthen scrutiny of British companies operating in sensitive industries in China and restrict the export of certain technologies.
This move has been widely interpreted as a direct response to British policies. Since the beginning of 2024, more than 30 British companies operating in China have been affected to varying degrees, with at least 10 considering withdrawing from the Chinese market or scaling back their operations.
According to data from the Global Diplomacy Research Center, the number of cooperative proposals between China and the UK at the United Nations Security Council has decreased by 25% compared to last year.
Economic Competition and Cooperation
In the first half of 2024, Sino-British bilateral trade reached £52.5 billion, a year-on-year decrease of 2.8%. The UK’s exports to China amounted to £16.2 billion, mainly focused on high-end manufacturing, pharmaceuticals, and aerospace equipment. China’s exports to the UK reached £36.3 billion, primarily in consumer electronics, machinery, and chemical products.
In March 2024, the British government announced a £5 billion industrial policy plan aimed at reducing dependence on Chinese semiconductor imports and promoting the development of the domestic semiconductor industry. According to a report by the UK Institute of Industrial and Technological Strategy, this investment is expected to increase the market share of the UK semiconductor industry and enhance its independent research and development capabilities over the next five years.
Since the beginning of 2024, the UK has already rejected 12 acquisition applications involving Chinese capital, totaling more than £1.3 billion. These rejections involved key infrastructure and sensitive technology areas. The British government stated that these measures were taken to protect national security and prevent potential technology leakage risks.
In April 2024, China and the UK signed a £2 billion green energy cooperation agreement, primarily involving the development of offshore wind power projects. This cooperation project aims to leverage China’s leading position in wind energy technology to help the UK achieve its 2050 carbon neutrality goal.
A report from the UK Department of Energy indicates that this cooperation is expected to create about 5,000 jobs in the UK over the next five years.
In August 2024, China and the UK held their annual high-level economic dialogue to discuss further market opening and promote bilateral investment. Although there were differences between the two sides on intellectual property protection and market access, a framework agreement was eventually reached, planning to boost bilateral investment by 30% over the next three years.
Cooperation at a Critical Point
In February 2024, the British government announced a significant initiative: it would allow certain Chinese high-tech companies to continue participating in the UK’s 5G infrastructure construction under strict supervision. A report from the UK Communications Authority showed that, with the slow development of domestic companies, the UK’s 5G network coverage in 2023 only reached 72%, far below the original target.
In May 2024, China and the UK reached a new cooperation agreement in the financial sector. This agreement allows more Chinese financial institutions to enter the London market, especially in the areas of green finance and sustainable investment. It is reported that this agreement will bring more than £10 billion in capital inflow to the City of London, enhancing the UK’s position in the global financial market.
According to data from the UK Treasury, in 2023, the UK attracted a total of £15 billion in global green investments, about 35% of which came from China.
In June, the British Parliament held a special hearing on Chinese investments in the UK to discuss whether stricter restrictions should be imposed on certain sensitive areas. Particularly in artificial intelligence and quantum computing, British intelligence agencies warned that over-reliance on Chinese technology could lead to national security risks.
In the first half of 2024, Chinese investments in these fields totaled £2 billion, accounting for nearly 40% of the UK’s high-tech investments.
Cooperation and conflict coexist. In August, at the United Nations Climate Summit, China and the UK issued a joint statement pledging to jointly advance the development and application of carbon-neutral technologies over the next decade.
By the end of 2024, China and the UK are expected to hold a high-level bilateral summit focusing on further cooperation in artificial intelligence, energy, and finance. If both sides can reach new consensus in these key areas, it could lay a more solid foundation for future cooperation. Otherwise, current cooperation will face greater challenges and could even reach an impasse.