China is back at the top of the political agenda. On Monday, the alleged Chinese spy known as “H6” at the heart of this scandal, involving (among others) Prince Andrew, was unveiled as Yang Tengbo.
The 50-year-old Chinese businessman has spent two decades in the UK, but was banned from the country last year on national security grounds. He formed close links with Prince Andrew, heading up the Chinese wing of the Duke’s Pitch@Palace entrepreneurial initiative. As well as being tangled up with the Prince, he also met two prime ministers (David Cameron and Theresa May) and was an influential figure on the diplomatic scene around the time George Osborne was talking about “a golden decade for the UK-China relationship”.
Yang has denied allegations that he has been involved in espionage on behalf of the Chinese government – as has the Chinese government itself, which has accused China hawks in Britain of fabricating “baseless ‘spy’ stories targeting China”. But taking the Mandy Rhys-Davies approach (“well they would, wouldn’t they”), the whole saga presents some interesting questions for the UK government – and for MPs more generally – when it comes to how to deal with China.
So far, the approach of Keir Starmer and David Lammy has been one of cautious engagement based on the reality that China is simply too big to ignore. When George interviewed Lammy last month, on the same day Starmer became the first UK leader to meet Xi Jinping since 2018, the Foreign Secretary accused the Conservative governments over the past 14 years of being inconsistent: “The problem with our position on China was that we didn’t have a position. We didn’t have a position of dealing with a global superpower and that simply was not good enough.” This is all part of Lammy’s doctrine of “progressive realism” and the idea of the “three Cs”: to challenge China (on issues such as human rights – or, indeed, espionage), compete where UK-Chinese interests do not align, and cooperate on areas such as climate change. The idea is that you can’t do any of this if you shut down the discussion before it’s started.
The counter argument is that allowing space for this conversation amounts to appeasement. This was the heart of the furious row that raged in the Commons yesterday afternoon. Iain Duncan Smith, the Tory party’s most ardent China hawk and one of the MPs sanctioned by Beijing in 2021 for speaking out about human rights abuses in the Xinjiang region, used an Urgent Question to ask why the government had not yet designated China a security threat. He asked about the foreign influence registration scheme – a long-awaited initiative requiring individuals who are paid by foreign governments to influence British politics to register so they can be kept track of. It’s designed to be a two-tiered system, and from the start there has been pressure to add China to the “enhanced” tier as a higher-risk country with greater requirements. A host of high-profile names on the Conservative benches – Suella Braverman, Tom Tugendhat and the new shadow home secretary Chris Philp – stood up to demand the same. Tugendhat even told the chamber that MI5 had advised him “if China isn’t in the enhanced tier, it’s not worth having”.
At the despatch box, the Security Minister Dan Jarvis had a delicate line to take. He assured the House that the foreign influence registration scheme would be set up by summer 2025, but would not be drawn on China specifically, saying only “work is underway to identify which foreign powers will be placed on the enhanced tier”.
The tension for the government isn’t just a question of political influence – it’s also (like everything else right now) about money. China is the world’s second-largest superpower at a moment when relations with the first-largest can best be described as uncertain (given the US president-elect has promised a new era of tariffs, including on UK exports). Labour has pinned all its hopes on growth, which is currently sclerotic – or, in fact, going backwards. The British economy desperately needs investment, and a lot of that investment comes from or is expected to come from China.
The government will be considering the pleas from some in the business community (particularly the financial services sector, as well as universities) not to be overly heavy-handed, conscious that the last thing the UK economy needs right now is yet another shock. And it will have taken note of Beijing’s furious response to the spying row and to the accusations made in parliament last night. The Chinese embassy has urged the UK “to immediately stop creating trouble, stop anti-China political manipulations”, accusing China hawks of having “revealed their twisted mentality towards China, as well as their arrogance and shamelessness”. Strong stuff.
Still, the fury from the Conservative Party (and from Reform – it was partly Richard Tice’s threat to name Yang under parliamentary privilege that led Yang to waive his anonymity) in the Commons this week risks making Starmer and Lammy look weak. Or, as Philp put it to Dan Jarvis, “sycophantic” towards China.
This is, of course, a recent phenomenon for the Tory party. As Jarvis reminded the House in response to Philp’s criticism: “At least [Starmer] did not take [Xi Jinping] to the pub for a pint.” You don’t even need to go back to the David Cameron era: Rishi Sunak was criticised by some in his own party for his reluctance to take a harder line with China, as was James Cleverly when he became the first British foreign secretary in five years to visit Beijing. Alleged Chinese espionage was a hot topic for Sunak too when a Conservative parliamentary researcher closely linked to Tom Tugendhat and fellow Tory China hawk Alicia Kearns was arrested last year on suspicion of spying.
Back then the Conservative Party was divided, because finding a way to balance national security with pragmatism, investment and the stability of the economy was very much its problem. Now Labour is managing this – while the Tories have the certainty that is a luxury of opposition. Lammy argued that the Conservative governments’ frequent U-turning when dealing with China reduced British influence. Will Labour’s policy of more consistent engagement survive if further rows, such as this one about Yang, emerge?
This piece first appeared in the Morning Call newsletter; receive it every morning by subscribing on Substack here.
[See also: Inside Labour’s China policy]
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