PM focuses on China and supply chain security in defence review but doesn't call Beijing a 'threat'

Tue 14 Mar 2023
Posted by: Phillip Adnett
Trade News

UK and Chinese flags flying on flagpoles

The government has announced plans to boost economic security and protect critical supply chains as part of a £5bn investment in defence over the next two years, as prime minister Rishi Sunak calls China the ‘biggest state-based threat’ to UK economic security.

The 2023 Integrated Review Refresh (IR23), launched yesterday (13 March), will help protect the UK economy, modernise the country’s nuclear sector and fund the next phase of the AUKUS submarine programme.

Sunak has also set an ambition to increase defence spending to 2.5% of GDP in the longer term.

Threats

IR23 was commissioned to respond to emerging geopolitical threats, including Russia’s invasion of Ukraine and China’s growing economic dominance and competition.

The PM said:

“We have seen all too clearly in the last year how global crises impact us at home, with Russia’s appalling invasion of Ukraine driving up energy and food prices.

“We will fortify our national defences, from economic security to technology supply chains and intelligence expertise, to ensure we are never again vulnerable to the actions of a hostile power.”

Threat level

China is the main focus of the refreshed defence strategy but Sunak stopped short of designating Beijing a ’threat‘ during his meeting with US president Joe Biden and Australian PM Anthony Albanese in California. The three met to sign a major submarine deal as part of the ‘AUKUS’ pact.

Sunak said China’s growing assertiveness was an “epoch-defining challenge”, but this is unlikely to be strong enough for China hawks in the Conservative Party, reports Politico.

Former PM Liz Truss had planned to officially label China as a ‘threat’, a major change in UK policy.

Protecting supply chains

The PM pointed to measures to stand up to China, including the blocking of a takeover of a Welsh microchip firm, moves to shield the UK nuclear industry and the removal of surveillance equipment linked to national intelligence organisations.

Details of the plan included an Economic Deterrence Initiative, aimed at strengthening sanctions enforcement, and a refresh of the Critical Minerals Strategy to protect UK supply chains.

Taiwan

The Telegraph notes that IR23 also includes a reference to the threat China poses to Taiwan.

In December last year, MPs on the Foreign Affairs Select Committee said that a “full-scale invasion” of Taiwan was “not unthinkable” and would expose the UK’s “strategic dependency on supply chains involving China across almost every sector”.

The committee warned that with a majority of the world’s semiconductors produced in Taiwan, any prolonged disruption would be “more damaging than the renewed illegal invasion of Ukraine”.