April 9, 2020

How do you solve a problem like China? Since the outbreak of Covid-19 and its development into a global pandemic, we have heard increasingly loud calls for a “reckoning” with Beijing.

It is beyond doubt that a reckoning is merited. Since the SARS outbreak in 2002, virologists have warned that the “large reservoir” of viruses in horseshoe bats, along with the Chinese custom of eating exotic mammals and using them for traditional medicines, has been “a time bomb” for the world’s health. Yet not only did China do nothing to clamp down on this danger before Covid-19, it has done nothing since.

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The only state action in China’s notorious wet markets since they reopened has been the recruitment of security guards to stop visitors taking photographs of the insanitary conditions.

While many of the West’s useful idiots have praised the scale and speed of the Chinese response to the outbreak, we know that Beijing’s first response was to deny there was a problem and silence the medics who tried to blow the whistle. In those vital days, millions of people left Wuhan, the centre of the outbreak, making it inevitable coronavirus would become an international danger. China refused to engage with the World Health Organisation and left other countries guessing the characteristics of the virus. Now, its diplomats and state-backed media outlets are spreading fake news, claiming coronavirus began in Italy or America.

This behaviour should not come as a surprise to anybody who has watched Beijing since China was allowed into the world’s system of international trade. China has abused liberal trading rules by over-producing goods and dumping them on other markets. It has engaged in mass industrial espionage. It has set debt traps for other countries to win leverage over them. The prosperity earned through trade has not made its state more liberal or democratic, but even more oppressive. It has developed technologies made possible by international trade and used them to control its people. And it has abused the openness of other economies to undercut rival businesses and blackmail governments.

So a reckoning is not only deserved, but long overdue. The question is, what can we actually do?

There are limits, of course. China is a world power, with a population of about 1.4 billion people. It has nuclear weapons and a military with more than two million active personnel. Its Belt and Road Initiative spans 65 countries, covers more than 60% of the world’s population, and involves investment plans reportedly worth $900 billion. It owns more than $1 trillion of US public debt, and has made itself a vital investor not only in the British economy but in our critical national infrastructure.

But this does not mean we can do nothing. By our own actions, and by working in concert with our friends and allies, there is plenty Britain can do to protect our citizens and interests from China’s actions.

The most immediate step should be to reverse the decision to allow Huawei, the Chinese telecommunications company, to run parts of Britain’s new 5G network. Whatever ministers and officials have convinced themselves, Huawei is not some benign company from a conventional market economy. It is subsidised by Beijing’s autocratic, communist regime so it can find its way into the most sensitive parts of other countries’ critical national infrastructure. Britain should change policy so – like the United States, Australia and other security allies — we ban Huawei from our system.

Critics will argue that the alternatives to Huawei — Nokia and Ericsson — are unable to provide the same equipment and services, and relying on these Western companies will take longer and cost more. But if officials believe we have been forced to make this awful choice because of a broken market, this is an argument not for strengthening Huawei but for making sure we do not destroy the market share of Nokia, Ericsson and other Western firms. It means we need to overcome our adherence to free market ideology and, working with allied governments, reform the telecommunications market, invest in new entrants, and make sure the West has tech capabilities to rival and surpass China’s.

Telecommunications is only one part of our critical national infrastructure we should be thinking about. Chinese companies are now huge investors in Britain’s energy sector. They part-own Britain’s gas piping network, and are funding the construction of the nuclear power station at Hinkley Point. As part of the deal agreed by David Cameron and George Osborne, Hinkley is the first stage of China’s “progressive entry” into the British nuclear system, allowing them to take on operational functions in future plants at Sizewell and Bradwell. And of course, Beijing’s investment strategy comes with a bill attached. Not only are the returns on the Hinkley deal absurdly generous, China uses Britain’s dependence on its investment as leverage in diplomatic and geopolitical controversies. We need to limit this leverage and curtail China’s role in our infrastructure.

This requires a different approach to economic policy and, in particular, a new form of industrial strategy. The coronavirus crisis is showing us not only that over-dependence on countries like China is dangerous, but that we need to keep certain industrial capabilities closer to home. British researchers are playing their part in the global effort to find a coronavirus vaccine, for example, but Britain has precious little capacity to manufacture vaccines at scale.

If and when a vaccine is discovered, experts have warned that we will need to wait in the queue to get it. Similarly, one of the reasons Germany is so far ahead of Britain in its testing strategy is, ministers explain, that the Germans have Roche, one of the world’s biggest diagnostic companies. Britain’s smaller diagnostics firms are dependent on Germany and the United States for their supplies.

Overall we need to build greater national resilience and far more state capacity to protect us from danger. The NHS will need more investment and capacity, but so will other state services, such as border control, and key parts of our social infrastructure, such as local authorities. The Government’s defence review, which is now effectively on hold while the state puts all its efforts into fighting the pandemic, will need to reflect the beyond-obvious fact that China — more than Islamist terrorism or Russian or Iranian aggression — is the West’s greatest threat and strategic rival.

Together with our allies, we need to wean ourselves off our over-dependence on China, with more manufacturing production and assembly work shifting to other Asian countries, such as Vietnam, lower-cost European countries, such as Poland and Portugal, and back home in Britain. Both governments and businesses will need to shorten the stretched global supply chains that serve the modern economy.

Of course there are limits to what Britain can achieve alone and, like the rest of the West, we desperately need the United States to return to its role as the leader of the liberal democracies. Without stable and sensible American leadership, we are all weaker. We need to build new alliances with countries that share similar interests to our own. Japan and South Korea — prosperous democracies with neighbourly concerns about China — are obvious examples. As Tom Tugendhat, the Chairman of the Commons Foreign Affairs Committee, points out, there is an opportunity for us to cooperate with what he calls the “new Indies”, independent states with an interest in the international rules-based order, including Japan and South Korea, but Chile, Kenya, Nigeria and others too.

And Britain can play an important role in forging a new multilateralism, in which the rise of new powers — not just China, but the likes of Brazil, India, Indonesia and Mexico — have the global voice they deserve. We can lead the creation of new institutions to ensure peaceful economic competition between East and West. And we can help to establish a new forum in which democratic governments can work together to regulate cyberspace and protect the internet from autocratic regimes. Predictably, China continues to seek a New Internet Protocol, which, in the name of “digital sovereignty”, would put the internet under the control of states. They must be stopped.

Compared with undemocratic states like China, it is often assumed that the democracies cannot act strategically and lack the state strength to get things done. But while there are many ways we can improve the way we are led, this is unnecessarily defeatist. Autocratic states lack legitimacy, democracies do not. They rely on fear, while we rely on our own choices to work with one another. They have alliances based on intimidation, while we have friendships based on shared values and interests. We will have to learn to live with an important and powerful China, but we must also learn to assert ourselves and protect ourselves from the very serious danger Beijing represents.


Nick Timothy is the author of ‘Remaking One Nation: The Future of Conservatism’ (Polity)