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China has criticised a trade deal between the UK and US that could be used to squeeze Chinese products out of British supply chains, complicating London’s efforts to rebuild relations with Beijing.
The trade deal the US sealed with the UK last week, which includes strict security requirements for Britain’s steel and pharmaceuticals industries, was the Trump administration’s first since it announced sweeping “reciprocal tariffs” last month.
Asked about the deal, Beijing said it was a “basic principle” that agreements between countries should not target other nations.
“Co-operation between states should not be conducted against or to the detriment of the interests of third parties,” China’s foreign ministry told the Financial Times.
The comments place London in a difficult position between the two economic superpowers and could make it more challenging for the UK government to reset relations with China.
Beijing has warned countries against signing trade deals with the US that threaten Chinese interests, fearing that President Donald Trump will use bilateral negotiations with America’s commerce partners to pressure them to cut China out of supply chains.
China has also responded by speeding up efforts to purge foreign-made components from its own supply chains, insulating them against trade war disruption.
Last week’s trade deal included cuts to punitive US levies on UK car and steel exports, but did not remove a baseline 10 per cent tariff on British goods.
The sector-specific tariff relief for steel and cars was also only granted on condition the UK “works to promptly meet US requirements” on supply chain security and the “ownership of relevant production facilities”.
UK officials have said Trump has made clear that China is the intended target of that condition. The deal specifies tariff relief for British products would depend on so-called Section 232 investigations, which determine whether and how specific imports affect US national security.
London’s acceptance of Washington’s security clauses sparked surprise and concern in Beijing, especially as UK Prime Minister Sir Keir Starmer’s government had been working to improve ties with China, according to trade-focused government advisers.
“China will need to respond — the UK should not have rushed to agree to the deal,” said one Chinese government adviser, who asked not to be named.
Zhang Yansheng, a senior researcher at the China Academy of Macroeconomic Research, said it was clear Washington would force other governments to accept similar provisions in trade negotiations to isolate China.
“For the UK to do this, it’s not fair to China,” he said. “This type of poison pill clause is actually worse than the tariffs.”
Zhang said China should “bluntly raise the issue in talks with the UK”, but should hold off from immediate retaliation.
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“The underlying problem is the US, other countries are secondary actors,” he added. “It needs to be discussed in trade talks with the US.”
The US and China on Monday agreed to a 90-day truce in their trade war, with Washington temporarily slashing tariffs on Chinese imports to about 40 per cent, from as high as 145 per cent.
Those levies could be reduced again by up to 20 percentage points if the two sides reach an agreement to stop the flow of fentanyl precursors from Chinese producers to the US. This would lower the level of Trump’s tariffs on China to approximately those on US allies such as the UK.
China on Monday agreed to lower its level of retaliatory tariffs on US imports such as energy products and farm goods from 125 per cent to 10 per cent.
The UK government said Britain had signed the US trade deal “to secure thousands of jobs across key sectors, protect British businesses and lay the groundwork for greater trade in the future”.
It added that “trade and investment with China remain important to the UK” and that Britain was “continuing to engage pragmatically in areas that are rooted in UK and global interests”.
Additional reporting by Lucy Fisher in London
