HCR Law Events

23 October 2020

Should we stop trading with China?

Britain has seen a huge shift in attitudes to China over the last five years. Relentless coverage of its crushing policy in Xinjiang, its Hong Kong crackdown and breach of the Joint Declaration with the UK, and its initial cover-up of the Covid-19 outbreak have all dragged down China’s reputation in the eyes of Western observers.

The UK and other countries are right to hold China to account.  In some ways China had too easy a ride in the past: no-one felt threatened by China when it was poor, and investigative journalists were unable to gather information about what was happening within its borders. That has all changed – satellite imagery is available to all, mobile phones provide video footage, and China itself has become more assertive.

Be careful that this mistrust of “China” – the Chinese government – does not spill over into Sinophobia, a prejudice against anything Chinese. There are over a billion Chinese people, only a tiny minority of whom are even remotely involved in the list of crimes set out above. The worst thing we can do now is to disengage from Chinese contacts. Trade, cultural exchanges, social interaction, education projects all help to defuse tension, because they force individual people from different countries to work and talk together. Without them, mistrust will increase.

A point raised by many is that many Chinese companies operate as arms of the state. That is, a national champion like Huawei might be forced to do the bidding of the Chinese government. The answer is to do your due diligence (as you should anyway). If you’re really worried that, by signing a distribution contract or a supply agreement with a Chinese company, you’re somehow supporting a nefarious policy of the CCP, then get experts to do investigatory work first to see if that is the case.

I’ve worked on both sides, sometimes acting for Chinese clients and sometimes for British clients dealing with Chinese entities. It is very rewarding to help individuals from both sides cooperate to achieve something greater than they could by themselves. To succeed, they need to arm themselves with knowledge, not prejudice.

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About the Author
Nicolas Groffman, Partner, Head of International Team

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