Iain Duncan Smith calls for review of Chinese investment in UK
Chinese ownership of British businesses should be subject to a national security review by the UK government to assess the impact of Beijing’s growing economic power, according to the former Conservative leader Iain Duncan Smith.
The senior backbencher – a leading figure in the rebellion that forced Downing Street to introduce tougher controls on Huawei – believes ministers have failed to deal with the scale of China’s influence on strategic industries in the UK.
The MP highlighted Britain’s leading supplier of blood plasma, BPL Group, which was once part of the NHS before it was privatised in 2013. It has been owned by a Chinese investment firm, Creat Group, since 2016.
BPL obtains blood plasma from patients in the US, using it to derive treatments in labs in Elstree in the UK. “An important priority” for the company is to derive an effective treatment for Covid-19 from antibody-rich plasma taken from recovered patients, several trials of which are going on globally.
But according to BPL’s most recent accounts, filed in August, the US committee on foreign investment asked the company to sell its US operation in 2019 to address “a series of national security concerns … regarding Chinese control of a US-based plasma collection business”.
“What’s going on is the insertion of Chinese influence in all sorts of areas,” Duncan Smith said. “It’s going on piecemeal, and it’s not been properly collated. I believe the government has to pull it together in a strategic review and wonder what the overall impact on the UK is.”
A Chinese company is a minority investor in Britain’s new nuclear power station at Hinckley Point and wants to build a reactor in Bradwell in Essex, while the position of telecoms supplier Huawei remains a source of contention.
Last week, the Commons defence committee warned that the remaining presence of Huawei in UK 5G networks until 2027 represented “a significant risk to individuals and government” – a statement rejected by Huawei and Beijing.
On Friday, a spokesperson for the Chinese foreign ministry said at a daily news conference: “The openness and fairness of the UK market, as well as the security of foreign investments there, is highly concerning.”
Concerns about China are growing significantly in Westminster, amid concerns about the country’s handling of Covid-19 and the treatment of its Uighur Muslim minority. On Wednesday, peers are due to debate a crossparty amendment to the post-Brexit trade bill, which says any trade agreements would be revoked if the high court formally determines that the other country is party to genocide.
Alan Mendoza, the chief executive of the Henry Jackson Society thinktank, said: “The US has rightly forced one Chinese firm to divest its US business, owing to the rapidly increasing importance of blood plasma treatments. The UK must now review its own strategic dependency on China in order to avoid being potentially held to ransom by an authoritarian state.”
BPL said it had benefited from Creat’s ownership. “Since the acquisition, Creat has invested over £100m in enhancing processes, talent and equipment to support the development of BPL Ltd into one of the world’s leading suppliers of plasma-derived therapies.”