China

Justin Madders Excerpts

Wednesday 15th May 2024 Westminster Hall

[Justin Madders (Ellesmere Port and Neston) (Lab)]

It is a pleasure to see you in the Chair this afternoon, Ms Rees. I congratulate the hon. Member for Isle of Wight (Bob Seely) on securing the debate and on his excellent, wide-ranging opening remarks. He set out the challenges we face as a country, and presented a pretty dystopian vision of the future, if we allow it to happen. I hope that we are able to collectively rise to the challenges he laid out.

The hon. Member raised a number of matters that I will touch on. I start with the refreshed integrated review, published by the Government last year, which stated:

“China…poses an epoch-defining and systemic challenge with implications for almost every area of government policy and the everyday lives of British people.”

I consider that a welcome revision to our approach. It is a pretty serious, broad statement of where we are and what we need to do. We need to recognise China’s size and influence, alongside the risks that it brings. The hon. Member for Isle of Wight made the point very eloquently that our reliance is one of those risks, alongside China’s greater aggression, its human rights record and the strengthening of its partnership with Russia; they are all potential existential threats.

In many respects, the news emerging this week on both sides of the Atlantic is a stark reminder that these challenges are here and now, and that care needs to be taken. I will take one very clear example from my own constituency, which feeds into the wider picture that has been painted today. There is a Stellantis plant in my constituency. It announced yesterday that it will be selling Chinese-made electric vehicles in Europe from the autumn, and in the UK from next year. We have a very proud history of manufacturing in this country, and indeed in Ellesmere Port, at what is commonly known as the Vauxhall motor plant, which is now owned by Stellantis. A lot of work was put in to secure the investment needed to move to electric vehicle production, which is very important for the plant, for the constituency and for the whole UK automotive sector.

I had hoped that we could lead the way in the sale of new electric vehicles, as the plan was always to expand from where we are now—from the production of vans into the domestic car market—so it is a concern that the owners are already turning to cheaper Chinese electric vehicles. It is too soon to understand the impact of that on domestic production, but surely it is not going to help. That is not to say that I want to insulate the UK from competition, but there has to be fair competition, and there has to be one eye on the future.

There is no doubt that the move to an all-electric vehicle country is going to be expensive and we should be looking at how we keep costs down, but if major manufacturers are already concluding that the best way for them to meet that challenge is to turn to Chinese imports, we are never going to have the domestic manufacturing capacity to meet domestic demand, never mind being able to continue to be the proud exporter to the rest of the world that we have always been.

As we have heard, yesterday President Biden announced he was introducing a 100% tariff on electric vehicles made in China, as well as tariffs on lithium batteries, critical minerals and semiconductors. That is a move designed to prevent cheap, subsidised Chinese goods from entering the US market. The decision was taken after a four-year review, and there are similar moves across the EU to assess the impact of Chinese imports. Since October, the EU has been investigating whether local subsidies have been helping Chinese car manufacturers undercut European-made vehicles. The investigation is due to report shortly.

I am not aware of a similar review being undertaken here. It was reported in February that the Government were contemplating commissioning the Trade Remedies Authority to undertake an investigation into subsidies, but three months on we have silence. Is the Minister able to confirm whether the Government are still looking into that and whether they will look at what the EU says if conclusive evidence of subsidies is found? We risk putting ourselves in a very exposed position. Our manufacturing capacity would be reduced, probably permanently, and we would be kidding ourselves about the race to net zero if we were reliant on Chinese imports.

Cars are just one example of our potential exposure; steel, energy, fibre optics, semiconductors, rare elements or any number of parts of our infrastructure are part of this discussion. We cannot allow ourselves to be at the mercy of one country, especially not one like China, which has what I would consider to be a ruthless focus on economic dominance. As we have heard from the hon. Member for Isle of Wight, that could lead us into a very dark place indeed.

Clearly, we benefit from Chinese investment in this country. Life sciences is a sector that it is investing in heavily. After what the hon. Member has said, that needs to be looked at very carefully as well. The fact is that I could go down any street in this country and see things that have Chinese ownership: pubs, shops, restaurants, cinemas. That is probably fair enough in a global economy, but what about water companies, energy companies and nuclear power plants? I wonder how we have managed to get to the point at which our critical infrastructure is so open to influence by Chinese investors. How have we got to the point where China is a part owner in Thames Water and has significant debts to at least two Chinese state-owned banks? I think we can all see where that might lead us if international tensions rise.

Away from manufacturing, as the hon. Member mentioned, issues in cyber-security have been well documented. Indeed, there was a debate here yesterday on the dangers of social media. I absolutely agree with what the hon. Member said about the differences between TikTok and its Chinese equivalent, Douyin. From a child’s perspective, in China it certainly has a lot more educational content. In 2021 the Chinese Government enacted a law that called for the

“creation and broadcast of online content conducive to the healthy growth of minors”.

That can of course be seen as part of the wider attitude to free speech in China, but it is of interest that they obviously see that some of the content on these channels might have a detrimental effect on a child’s development, but they are more than happy for that stuff to be pumped on to our own children’s screens.

[Neil Coyle]

When my hon. Friend says “they”, he is talking about the Chinese Government. Does he welcome the distinction that the hon. Member for Isle of Wight (Bob Seely) made at the start of the debate between the Government of China and the people? As someone who lived in China for two years, may I make a personal statement?

(The Member continued in Mandarin.)

For those who do not know any Mandarin—I appreciate that mine is rusty—that translates as: “I like the country and I like the people. It is the Government who have caused the concerns that are the focus of the debate today. It is the politicians and the political leadership of China that is the challenge.”

[Justin Madders]

I thank my hon. Friend for his intervention. He makes a very important point—the bits of it that I actually understood. He must have seen my speech because I am about to make the very important distinction—

[Neil Coyle]

In Mandarin?

[Justin Madders]

Not in Mandarin, no—in English. There is a very important distinction that we would all make between the Chinese people and the CCP. There is no doubt that the CCP is the malign influence in all this.

On the question of social media, there is a concern that there may be an imbalance between what we see in this country and what is seen in China, and there may be deliberate reasons for that. We should certainly look at that and at the dangerous anti-western, conspiracy theory, democracy-undermining stuff that comes out from all around the world, and in particular from China.

I echo the comments made by the director general of MI5 in 2022. He said that it would be wrong for us to cut ourselves off from one fifth of the world’s population, and that we should continue to engage and work with China in a way that is consistent with our national security. But I do not think we have the balance right. As the hon. Member for Isle of Wight said, that balance will be consistently and constantly reviewed. We need greater international resilience to international incidents. The analogy with what happened in Russia is very important, because that is a real threat that we could face in the next few years, and we do not want to leave ourselves overexposed.

As has been said, many western countries have begun to understand the risks that we face, have taken action against firms such as Huawei, and have limited the use of such technologies in sensitive and critical infrastructure. In that context, questions must now be raised about our reliance on supply chains that are controlled by China and have such a huge impact on our infrastructure.

It is clear that China holds a dominant position over global supply chains that are critical to the net zero transition. It controls a significant proportion of the rare metals necessary for lithium-ion batteries, wind turbines and solar photovoltaic modules. On the lithium-ion battery chains, China is responsible for 80% of the supply of spherical graphite, refined manganese, anodes and electrolytes, so we clearly need a co-ordinated response to that.

It feels as though we are at a very important point in global politics. We must work across the globe to deal with the many challenges that the planet faces, while at the same time protecting our national security and long-term economic interests. Taking a cautious and proactive approach to risks is central to protecting our country and its citizens. I believe that the way we approach China will be a central feature of our lives for many years to come. On every occasion that we deal with it, the question of security, economic or otherwise, must be the very first thing we ask.

[Several hon. Members rose—]