The UK finds itself entangled in a complex diplomatic dilemma as it grapples with a controversial proposal for a massive new Chinese embassy in London. This proposed structure, planned for the historic Royal Mint Court, has triggered massive protests and raised concerns over national security, surveillance, and the broader geopolitical implications of strengthening ties with China while risking relations with the United States, particularly under a potential Donald Trump administration.
A Contentious Agreement
The controversy sparked after a meeting between Labour Party Prime Minister Keir Starmer and Chinese President Xi Jinping in November 2023. According to the report, during the meeting, Starmer assured Xi that his government would help clear obstacles for the construction of the new embassy. This move came despite the fact that the Tower Hamlets Council had previously rejected the project twice in 2022, citing security risks and strong local opposition.
China’s Finance Ministry announced on January 14, 2024, that China and the UK had reached 69 trade and financial agreements, projecting economic benefits worth approximately £600 million (US$744 million) for Britain over the next five years. While such economic cooperation may be seen as beneficial, opposition voices argue that the costs of aligning too closely with China could outweigh the benefits. China has always leveraged its economic position to get constructions, investments and diplomatic deals in its favour. As Trump threatened to slap tariffs on its allies such as the EU and the UK, this may be considered as a precautionary measure from the UK side to keep its business options open.
Tom Tugendhat, an opposition Conservative Party MP, expressed his concerns at a rally against the project on February 8, stating, “We want to cooperate and trade with everyone around the world. Of course, we do, but that isn’t cost-free. It doesn’t come for nothing. You’re looking at the cotton out of Xinjiang, or you’re looking at the batteries and solar panels made by slaves. The question is: how much blood are you willing to have on your hands for cheap goods? We fought against slavery in this country 200 years ago.”
US-UK Relations in Jeopardy?
In the context of the current trade relation between the UK and the US, the timing of Starmer’s attention to China looks sensitive and creates uncertainty in the UK’s relationship with the US. After US President Donald Trump returned to the White House, the threat of revising trade agreements with the UK and putting tariffs on the UK loomed large. Trump has hinted at imposing tariffs on UK imports, which could have severe economic ramifications for the UK.
In early February, Trump said he would slap tariffs on the European Union to address its “massive” trade surplus with the US. The UK enjoyed a 2023 trade surplus of £71 billion (US$88 billion), while the surplus for the EU was only 52 billion euros (US$54 billion). Should the US impose a 10% tariff on UK imports, British exporters would face annual costs of approximately £6 billion to US Customs, given that the UK exported £60 billion worth of goods to the US in 2023.
While Trump has not explicitly linked the Chinese embassy issue to his tariff considerations, the geopolitical optics of the UK facilitating a major Chinese diplomatic expansion could influence his stance.
Security Concerns
On February 8, thousands of protesters, including Hong Kong activists, Uyghurs, Taiwanese, and Myanmar nationals, rallied outside the Royal Mint Court to oppose the proposed embassy. Demonstrators clashed with police as authorities attempted to control the crowd, leading to two arrests.
Robert Jenrick, the Shadow Secretary of State for Justice and a Conservative MP, delivered a fiery speech at the protest, stating, “When you have China stealing our intellectual property, spying on members of our government, sanctioning MPs, and intimidating British citizens day in and day out, why would we allow them to have the biggest mega-embassy and spy headquarters in Europe? No self-respecting country would do that.”
Another Conservative MP, Iain Duncan Smith, condemned China for its aggressive tactics in the South China Sea and its plans to invade Taiwan. Blair McDougall, an MP from the Scottish Labour Party, demanded that China close its “concentration camps” in Xinjiang, unfreeze the pension funds of Hong Kongers, and release British citizen and pro-democracy activist Jimmy Lai from prison if it wished to proceed with the embassy.
Historical Context
China acquired the Royal Mint Court site of 5 acres in 2018 for £255 million (US$324 million) and planned to build a diplomatic complex accommodating 250 staff members. The site holds historical significance, having served as a mint from 1809 to 1967 and earlier as a Black Death cemetery.
In 2022, The Tower Hamlets Council, a local authority, rejected the project. The reason cited by the body – potential security risks due to large-scale protests the embassy might attract. However, after Starmer assumed office, the Labour government signalled a willingness to approve the project. Foreign Secretary David Lammy and Home Secretary Yvette Cooper submitted a joint letter last month stating that the Metropolitan Police had withdrawn its previous objections to the embassy, a move seen as particularly bolstering Beijing’s chances of gaining planning approval.
The final decision now rests with Deputy Prime Minister and Housing Secretary Angela Rayner. A public inquiry is scheduled from February 11 to 18, coinciding with a planned visit to the UK by China’s top diplomat, Wang Yi.
National Security Concerns
Opponents of the embassy project cite past incidents involving Chinese diplomatic staff as evidence of potential risks. In 2022, Chinese consulate staff in Manchester attacked pro-democracy protesters, an incident that drew international condemnation. More recently, three men linked to the Hong Kong Economic and Trade Office (HKTEO) in London were accused of harassment and surveillance of Hong Kong activists in the UK.
Adding to the espionage concerns, the UK’s MI5 intelligence agency has labelled China the “number one espionage threat” to Britain. Last December, the UK High Court revealed in a ruling that Prince Andrew was involved with an alleged Chinese spy, Yang Tengbo, who was later barred from the UK on national security grounds.
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Crossroads for UK
At a deeper level, the proposed Chinese embassy carries important implications for British foreign policy. The Labour government seems to put more focus on being cooperative with China, but critics consider it to be done at the expense of national security and human rights concerns.
In the coming days, the situation will further unfold, and the UK government may have to make a difficult decision to keep the promise Starmer has given to Chinese President Xi and risk UK relations with the US. Either way, the UK’s handling of the issue will be a litmus test for its diplomatic priorities in an increasingly polarized global landscape. It will be interesting to see how the UK government manages to climb out of this complicated issue.