China recently approved its 15th Five-Year Plan,
which seeks to secure China's leadership in the
industries of the future while boosting its own economic
self-reliance. It has a huge middle class, dynamic innovation
ecosystems, and an improving business environment.
In China, the UK has a strong reputation for the
quality of its brands, its education system, and its creative
industries.
The current Government has committed itself to pursuing the
growth opportunities that China offers. But what
opportunities does China offer UK business that outweigh the
threats – and what is the cost of those opportunities? Given
the changes sweeping the world economy and
China itself – geopolitical upheaval, technological
transformation, the fragmenting global trading system –
how sustainable are those opportunities likely to be?
In China consumption remains low and domestic
competition is fierce. Made
in Britain is no guarantee of success against
increasingly sophisticated, but still low priced, local
competitors. UK firms wishing to succeed in China's
market need deep expertise in the local
business regulations, the political environment, online
ecosystems, and consumer tastes, all of which differ
significantly from those in the UK.
Commentators have highlighted the risks to the
UK's wider economic security that greater interdependence
with China could bring.
In an overall picture of a
growing UK trade deficit with China, a few
facts stand out. While exports to China overall are straight
declining, the UK is running a steadily growing surplus in its
trade in services with China (+£9.5 billion in
2025).
Imports from China were declining, but as
Politico recently reported after an FOI request to
HMRC, £8.3 billion worth of de
minimis goods — parcels priced under £135 — were
imported into the UK completely tax-free last year, up from
£3.9 billion in 2023/24.
And the Government decision to
block much-needed investment in the UK by Chinese
firm Ming Yang highlighted a central dilemma facing the UK
economy. How much business can the UK afford to do with
China?
The opening evidence hearing of the Committee's inquiry
on China and the UK
economy brings together heads of industry
and manufacturing and representatives of the UK's leading
services sectors to ask:
- what does UK business know about doing
business with China?
- how good is the UK Government at helping navigate the
opportunities and threats?
The Committee will seek to:
- Analyse the current and potential benefits to the UK of
deepened economic engagement with China.
- Explore how UK businesses weigh up the risks and rewards of
doing business with China.
- Assess how firm- and industry-level calculations of
commercial risk differ from national-level calculations of
economic security risk.
- Assess the opportunity costs to businesses and the UK overall
of pursuing a deeper economic relationship with China rather than
with other economic powers.
- Gauge the UK business community's view of the effectiveness
of the Government's approach to China and its guidance to
businesses.
Rt Hon MP, Chair of the Committee,
said: “Right now, British business faces a
‘duo-shock' of new American tariffs and unprecedented Chinese
state subsidies for local Chinese firms. That's why British
business needs help getting its China strategy right.
"There are undoubtedly rewards for developing trade with China,
but there are huge risks too. The question is no longer whether
we engage, but how we do so without losing control of our future.
British firms are succeeding in sectors like services, education
and the creative industries - but they are not playing on a level
playing field.
"Our inquiry will test whether the UK has a clear strategy to
seize the opportunities, guard against the risks, and ensure that
trade with China strengthens - not weakens - Britain's long-term
security and prosperity, in what is a very uncertain world.”
On Tuesday 21
April 2026 from
2.30pm: Scene-setting
- Rain Newton-Smith, Chief Executive at Confederation of
British Industry (CBI)
- Peter Burnett OBE, Chief Executive at China-Britain
Business Council
At approximately 3:10pm: Manufacturing
- James Brougham, Senior Economist at Make UK
- Shaun Grady, Chair at AstraZeneca UK
-
Scriven, Managing Director
of Bike Hire at Brompton Bicycle
At approximately 3:50pm: Services
- Miles Celic, Chief Executive Officer
at TheCityUK
- Professor Sir Peter Mathieson, Principal and
Vice-Chancellor at University of Edinburgh
- Sabina Ciofu, International Policy and
Strategy Lead at techUK
