For decades, the United Kingdom’s relationship with China has oscillated between cautious engagement and outright tension. In recent years, Conservative governments have swung from David Cameron’s much-touted “Golden Era” of Sino-British cooperation to Rishi Sunak’s warning in 2023 that China threatened “our way of life.”
In November 2024 at the Rio G20, Prime Minister Keir Starmer became the first British leader to meet President Xi Jinping since 2018, pledging a “consistent, durable, respectful” partnership.
This rebuff of the previous government’s frosty stance signals Labour’s intention to steady Britain’s China policy. In Labour’s telling, the Conservatives’ 14 years of “inconsistency” left UK-China relations badly in need of a “long-term and strategic approach.”
Under Starmer’s “pragmatic” vision, Britain will cooperate with China on trade and green energy where interests align, but still “compete” economically and “challenge” Beijing on security and human rights where necessary.
From golden era to deep freeze
To grasp Labour’s change in approach, it’s important to remember the fluctuations in Britain’s China policy. In the early 2010s, Prime Minister David Cameron promoted a “Golden Era” of engagement with China. He sought Chinese investment and famously invited Xi Jinping for a state visit, even sharing a photo while enjoying a pint of ale.
Back then, London gambled that supporting China’s economic rise would boost UK business. But this “mercurialist opportunism” proved short-lived. By the late 2010s, Britain had grown alarmed at Beijing’s hardline turn, which included the clampdown on Hong Kong dissidents, abuse of Uyghurs in Xinjiang, and aggressive actions in the South China Sea that alarmed parliament.
Successive Conservative prime ministers stiffened their rhetoric. Boris Johnson and Liz Truss called China a strategic threat, and the UK banned Huawei from its 5G networks. In Sunak’s 2021 Integrated Review, Beijing was labelled an “epoch-defining systemic challenge” and “the greatest state-based threat to our economic security.”
Labour’s last time in government, from Tony Blair to Gordon Brown (1997– 2010), was primarily characterised by a pro-engagement approach. New Labour viewed China in terms of trade and diplomacy, exemplified by the handover of Hong Kong to China in 1997 and the support for large Chinese-funded projects, such as Thames Water. However, even during that era, Labour governments understood the importance of addressing human rights issues with Beijing, albeit behind the scenes.
Over the past three decades, UK policy has swung like a pendulum— alternating between friendly engagement and investment under Blair and Cameron, and adversarial rhetoric framing China as a threat under Sunak.
Labour and Conservative critics alike contend that this policy pendulum has bred confusion. In its manifesto, Labour condemned 14 years of what it called “damaging Conservative inconsistency” on China, pledging instead to bring clarity, strategy, and a steady hand.
Labour’s new China policy
Upon taking office in July 2024, Starmer’s government pledged a “full audit” of UK–China relations, which they described as an in-depth review covering everything from trade and investment to security and supply chains. The audit (still ongoing) is meant to define a coherent China strategy, reversing what Labour sees as years of flip-flopping.
Officially, the new stance is straightforward, emphasising the need to cooperate wherever possible, compete where necessary, and challenge when required. In practice, ministers have begun outreach. Foreign Secretary David Lammy, in October 2024, made the first UK ministerial trip to Beijing in six years, promising to find “pragmatic solutions” and praising the “vast scope of mutually beneficial economic cooperation.”
Chancellor Rachel Reeves likewise flew to Beijing as her first overseas trip of 2025, announcing deals she estimated would add £600 million to the British economy over five years. Business Secretary Jonathan Reynolds has signalled his eagerness to revive long-frozen trade talks (the JETCO and Economic-Financial Dialogue) with China.
Starmer himself has adopted a moderately upbeat language. At the Rio summit, he said the UK and China are “both global players, both permanent members of the United Nations Security Council,” and promised “serious, pragmatic discussions” with Xi on trade, the economy, climate, science and more.
He emphasised making relations “consistent, durable” to avoid last-minute surprises. Labour spokesmen also stress that Britain will remain a “predictable, consistent sovereign actor committed to the rule of law,” even as it deepens dialogue with Beijing.
Yet critics note that a debate still rages within government. Some, notably Treasury ministers like Reeves, advocate for closer ties to spur growth, while security hardliners—known as “securocrats” in Whitehall lingo—urge caution. The delayed and scaled-down audit report, which is now expected to be released only in part this spring, reflects these underlying tensions.
Labour argues that by formally engaging China, it can speak more candidly on tough issues, while human rights groups worry the balance is tipping too far toward accommodation. As one analysis put it, Labour’s audit risks becoming “little more than a postmortem,” with “cooperate” the only surviving policy pillar.
So far, Starmer has talked of a “strong UK–China relationship” (to echo Cameron’s phrase), but also promised a “strategic and long-term” partnership that upholds British interests and values.
Economic imperatives
At the heart of Labour’s outreach is economics. Britain’s economy is under pressure, with sluggish growth, high borrowing costs, and post-Brexit trade challenges, while China continues to be the world’s second-largest market. The Starmer government sees Chinese trade and investment as too big to ignore. Indeed, China has already poured more into the UK economy (some £68.5 billion since 2000) than it has into any other European country.
London wants more of that money, especially in sectors like clean energy, advanced manufacturing and financial services. Reeves and Reynolds have hinted that even state-backed Chinese investment could be welcome if it helps jobs and innovation, provided it doesn’t compromise national security.
British businesses are drawn to China because it represents a vast and promising customer base. Labour points out that re-engaging could boost exports of cars, machinery, financial services and other UK strengths. For example, Chinese carmakers are expanding in Britain and could deepen ties.
The government is exploring fresh trade agreements and supply chain partnerships, and even sectoral deals to open up markets for British producers. Reeves’s recent visit aimed to “concrete” deals worth hundreds of millions, underscoring the growth argument.
Global supply chains also play a role. Many British industries rely on parts and technology from China, so a frigid relationship risks disruptions and higher costs. Labour argues that engagement lets the UK push for more “resilient” supply chains, rather than pushing China-driven manufacturing onto China’s rivals.
Ministers aim to rebuild dialogue, including efforts to revive the long-dormant UK–China Joint Economic Commission, to avoid a damaging trade war and gain leverage to shape rules on tech transfer and subsidies.
That said, economists caution that the bonanza may be overstated. After years of intense strategic rivalry, Chinese firms have grown wary of investing in the UK. An analyst notes that Chinese investment into Europe plunged to its lowest level since 2010 in 2023, and Beijing’s high domestic savings mean it may not need foreign help.
Indeed, Foreign Policy recently warned that “China is simply unlikely to invest much in Britain,” despite London’s olive branch, given Beijing’s concerns and tighter scrutiny from allies. Still, Labour’s message is that even a modest uptick in trade could help a struggling British economy, and that hedging against global risks is worth it.
Political calculations
Labour’s China policy is as much about politics as economics. Domestically, delivering growth and jobs is Starmer’s top priority; success in attracting investment could neutralise charges that Labour is weak on China or misguided about rights.
By contrast, resuming trade talks enables Labour to assert that it is standing up for British businesses, a crucial move if economic growth falls short. In this light, Reeves’s £600m deal was touted as a vindication of “pragmatic engagement” with China.
Globally, Labour may see reengagement as a way to burnish Britain’s influence. As the UK advances its post-Brexit ambitions in Asia, including the Indo-Pacific “tilt,” CPTPP negotiations, and deeper ties with India, Australia, and others, maintaining influence with China could prove to be a valuable diplomatic asset.
London hopes to secure a seat at the table on major global issues by opening channels on climate change, AI, and development, which ministers often describe as areas more conducive to cooperation. Some strategists also argue that a neutral UK with friends on both sides could moderate great-power competition; Starmer’s team talks of avoiding Washington’s trade war with China in favour of multilateral solutions.
Electorally, Labour may calculate that the British public cares more about economic well-being than China’s internal politics. Polls suggest most voters are not narrowly fixated on Beijing; they want cheaper goods and more jobs. Engaging China can therefore be framed as patriotic pragmatism, involving the use of every available tool to grow the economy while still rejecting unfair practices. By contrast, opposing all Chinese engagement might be framed as ceding British wealth to the likes of France or Germany, a tough sell to voters amid cost-of-living pressures.
However, Labour must tread carefully. Critics, particularly on the right, paint any rapprochement as weakness. After Starmer’s Xi meeting, some commentators warned it would “strain UK–US relations” and signal submissiveness, since China was arresting Hong Kong protesters at the same time.
Some MPs are sceptical that China will respond in kind; reports suggest even Chinese state media has doubted Britain’s sincerity, wondering if London could be “fair” to Beijing. Still, by acknowledging shared global responsibilities (multilateralism, climate, stability), Labour aims to justify its approach as safeguarding UK interests in a multipolar world.
Security and ethical concerns
No discussion of China can ignore deep security and human-rights fears. Labour publicly promises to “stand with” Hong Kong’s exiles in the UK and safeguard British values.
In practice, ministers say they will “challenge where we must,” which means Beijing can expect blunt criticism over Hong Kong’s national-security law, abuses in Xinjiang, and its support for Russia. For example, after Reeves’s China trip, she pointedly raised the cases of Hong Kong dissidents and China’s role in the Ukraine War. Foreign Secretary Lammy similarly told Wang Yi that Xinjiang and Hong Kong must be discussed even if “viewpoints diverge.”
On security, Labour faces pressure to continue Conservative-era safeguards. London has already used its 2021 National Security and Investment Act to block or scrutinise Chinese takeovers in tech (like the semiconductor plants). Ministers are now considering whether to blacklist parts of the Chinese state under a new Foreign Influence Registration Scheme, and have installed a National Protective Security Agency to help businesses resist espionage.
In other words, trade with China is being opened only to a limited extent, as deep tech, telecoms, and critical infrastructure will remain off-limits. Even within Labour’s pro-business wing, there’s recognition that some sectors must be kept secure.
The ethical dimension is thornier. Starmer’s government avoids provocative gestures, such as refraining from formally declaring Xinjiang a genocide despite pressure from some MPs, but maintains that it will not turn a blind eye to abuses. Labour says re-engagement is precisely a tool to gain leverage on sensitive issues.
A recent House of Lords briefing notes that the new Foreign Office approach is described as “cautious cooperation and challenge,” involving collaboration with China on trade and green energy while consistently raising concerns about human rights.
In his speeches, Starmer has stated that he intends to match China’s candour, reflecting Xi’s call for “tough-minded honesty” in discussions about global power dynamics. Whether Beijing will accept British criticism of, say, Xinjiang or Hong Kong in return for access to markets is uncertain.
Britain also must guard against covert threats. A series of spy scandals, ranging from a Chinese agent in Parliament to suspected cyber-attacks on the Ministry of Defence, has intensified concern in Whitehall. Labour diplomats argue that engaging China on economic fronts could facilitate intelligence sharing on cyber issues or counter-espionage. However, critics warn that the opposite may occur, with relaxed ties potentially offering Beijing more channels to influence UK public life.
Some advocacy groups drew tens of thousands to protest a plan for a new “mega-embassy” for China in London, warning it could become a hub for surveillance or propaganda. In sum, Labour’s China policy insists it will protect sovereignty and values even while trading, but it remains to be seen how robustly that line will be defended.
A high-stakes gamble
Labour’s China strategy is a high-stakes bet, with potential upsides but serious pitfalls. On the reward side, even small wins could matter. Smoother UK-China trade may lower costs for British consumers and boost exporters. Chinese investment in infrastructure or tech could fill funding gaps the Treasury can’t.
More engagement also gives the UK more insight into Beijing’s thinking on Taiwan or North Korea, possibly giving London influence in crisis moments. Business lobbies generally support the outreach, arguing that isolation from Asia’s largest economy would be more harmful.
However, downsides loom large. Many experts warn that China will not rush to invest in Britain because the economy is relatively small, now outside the EU single market, and Beijing has domestic priorities. Foreign Policy bluntly noted that “China is simply unlikely to invest much in Britain,” pointing out that Chinese FDI in Europe is now at near-record lows.
There’s also the risk of damage to alliances, as a too-cosy approach might upset Washington and Canberra and could erode moral credibility on rights. Labour’s critics fret that investors back home or overseas could shun the UK if they fear a security laxity. For instance, China could learn where the UK’s vulnerabilities lie.
On the domestic front, the government could face a political backlash if any China-linked project goes awry. For example, this occurred with British Steel’s Chinese ownership. Similarly, Starmer could be criticised if he appears to endorse autocracy. The recent spat over Jingye Steel, where officials alternately threatened and then courted the Chinese owner of British Steel, shows how quickly the needle can swing.
Labour’s leaders insist that difficult issues like Hong Kong will not be swept under the rug, but human rights groups are already accusing Starmer of softpedalling on genocide concerns. Any perception of a U-turn on values could dent the party’s image among voters who prioritise Britain’s global leadership on democracy.
Finally, there is strategic risk. If Beijing fails to deliver the hoped-for gains, such as investment, trade deals, or support on world issues, then Labour will have little to show for letting relations warm. And if the United States increases its pressure, such as by dragging the United Kingdom into a tariff war or encouraging allies to reject Huawei in 6G technology, Britain may find itself squeezed. The rewards may be uneven, while the risks affect national security and alliances.
Labour’s China outreach marks a significant departure from the recent freeze in UK policy. Framing it as sober realpolitik, Starmer’s government has explicitly pitched a middle way between Cameron-era naivety and Sunak-era confrontation.
The new approach rests on compartmentalising economics from geopolitics, aiming to welcome Chinese money and trade deals while maintaining strong national security and keeping human rights on the agenda. This balanced posture, described as “cooperate, compete and challenge,” has support in business circles but attracts criticism from hawks and activists.
For now, Labour’s strategy serves as a test of its foreign-policy credibility. If China responds in kind, such as by reopening markets or softening some harsh policies, the government will claim vindication. If not, critics will charge that Starmer’s warmth has bought little and cost valuable goodwill among allies.
Either way, the choice to reset relations is reshaping Britain’s global posture. As Britain’s House of Lords briefing dryly notes, the onus is on London to deliver a “consistent, long-term and strategic approach.”
In a world where tensions between the US and China dominate headlines, Britain’s gamble is to chart its own course. The coming months will reveal whether that course brings prosperity or peril, and whether Labour’s promise of pragmatism proves successful.
However, a recent emergency move by the British Parliament to take control of a Chinese-owned British steel mill has struck a discordant note amid all the diplomacy. It could raise deeper questions about Starmer’s efforts to cultivate warmer ties with China, at a time when Donald Trump’s tariffs are sowing fears about protectionism and fraying trade agreements worldwide, forcing the European country to find geopolitical hedges.
Britain intervened to stop a Chinese-owned plant in Scunthorpe from closing its blast furnaces, risking 2,700 jobs and a strategic supply. Failed talks sparked accusations of bad faith and raised concerns over Chinese investment in sensitive sectors.
Meanwhile, Hong Kong barred MP Wera Hobhouse, a critic of its free speech record. As Starmer seeks to revive the “Golden Era” of Sino-British ties, tensions and mistrust remain, leaving the future of cooperation uncertain.