Domestic Policy

Boris Johnson flags shift on rules for Chinese investment

By Litika Bourke /The Sydney Morning Herald/ – Prime Minister Boris Johnson has flagged new measures to protect British technology in the wake of the coronavirus pandemic, after being urged by a Conservative MP to rethink his decision to allow China’s Huawei to build Britain’s 5G networks.

Boris Johnson dramatically shifted his tone after a growing backlash among his own MPs against Chinese investment following the COVID-19 crisis.

Conservative MP Richard Drax used Prime Minister’s questions to urge Johnson to copy France’s review of defence supply chains because of concerns China is buying up companies at risk of going bust during the pandemic.

Johnson told the Commons: “[Drax is] absolutely right to be concerned about investment, to be concerned about the buying up of UK technology by countries that … may have ulterior motives.

“And we are certainly bringing forward measures to ensure that we protect our technological base and … you’ll be hearing a lot more about that in the next few weeks,” the Prime Minister said.

Australia has already subjected all foreign investors to federal screenings, to prevent state-owned takeovers of businesses made vulnerable by the pandemic.

Conservative MP and former deputy prime minister Damian Green told The Sydney Morning Herald and The Age: “This is an intriguing and potentially very encouraging signal from the Prime Minister.”

Johnson’s plan to allow the Chinese vendor to supply 35 per cent of Britain’s networks sparked a furious backlash amongst government MPs, who mounted a significant rebellion in the Commons before the pandemic. Drax and Green were among the 36 MPs who crossed the floor on a Huawei-amendment attached to an unrelated bill in March.

Just 13 more MPs are needed to change the bill when it is put to the Commons, promised in the next two months.

However, sources believe there are now enough MPs to change the government’s Huawei decision, including putting a hard time limit on when Chinese equipment can be used in the networks.

Tory opposition to the decision has grown since the coronavirus pandemic and China’s initial cover-up of the virus, which emerged in Wuhan.

A grouping of Conservative MPs, many of them newly elected in Johnson’s December landslide, have formed a China research group, similar to the Brexit-backing Eurosceptic European Research Group (ERG).

Alan Mendoza, executive director of the hawkish think tank Henry Jackson Society, said Johnson’s comments were “doubly welcome.”

“The government has now finally woken up to the reality – understood some time ago by national security experts – that halfway houses trying to have the best of all worlds will inevitably collapse.

“Chinese involvement in our critical infrastructure is a security threat to the UK which must be resisted.”

Australia and the United States have urged Britain to block Huawei in line with their own bans. The United States has threatened to restrict Britain’s access to Five Eyes intelligence which is gathered and shared by the US, UK, Australia, New Zealand and Canada.

Source
The Sydney Morning Herald
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