Political tensions continue to rise between China and in the west, business leaders say British firms are racing to reduce their economic ties to Beijing – even if it means passing on more costs to consumers.
Tony Dunker, chief executive of the Confederation of British Industry (CBI), warned that thousands of companies in Great Britain are restructuring their supply chains in anticipation of rising anti-China political sentiment.
“Every company I’m talking to right now is rethinking their supply chains … Because they expect our policymakers to inevitably accelerate toward a world that’s decoupled from China,” he said. Financial Times.
According to him, Britain needs to develop “new strategic alliances in the world.”
He added that the need for companies to build “resilience” in preparation for a divorce from China is also “all the talk” in Washington.
The move could also exacerbate the UK’s cost of living crisis, he said.
“It doesn’t take a genius to think that cheap goods can be a thing of the past,” Mr Dunker said.
Cutting China out of the supply chain “will be more expensive and therefore inflationary and will redefine Britain’s trade strategy. . . it will no longer matter who we sell to, but where we get it from,” he added.
Earlier this week China featured prominently in the leadership debate between Liz Truss and Rishi Sunak as part of the fight for 10th place.
The former chancellor accused Ms Truss of seeking closer ties with China.
Mr Sunak said: “There was a time when Liz was talking about a golden era of relations with China and the mission there was talking about deeper cooperation on things like food security and technology.
“But what we need to do is recognize that China is a threat to our national security, it’s a threat to our economic security.”
Ms Truss, on the other hand, accused Mr Sunak’s former department, the Treasury, of seeking a “closer economic relationship” with China.
She said the foreign ministry had meanwhile taken “the toughest stance” on the country, including “clearly stating that Taiwan must be able to defend itself”.
The CBI has not endorsed either candidate in the Tory leadership race.
Mr Dunker said he was happy they were discussing positive business strategies.
British businesses are “looking to sever ties with China”, which could exacerbate the cost of living crisis
Source link British businesses are “looking to sever ties with China”, which could exacerbate the cost of living crisis