China criticises US-UK trade deal, warning agreements shouldn't 'target or harm any third party'

Australia Broadcast Center

14-05-2025

China has criticised the United Kingdom's trade deal with the United States, saying that no agreement should "target or harm any third party", amid concerns the agreement could see Chinese products excluded from British supply chains.
Experts say Beijing's response indicates countries, including Australia, will have to strike a delicate balance between negotiating with the US on tariffs and keeping China on-side.
The first deal following US President Donald Trump's sweeping tariff regime saw levies dropped on key British goods including steel and cars.
However, the reduction was on the condition that the UK "meet US requirements" on supply chain security and ownership of certain facilities.
The Financial Times newspaper reported that UK officials confirmed the US intended to target China with those stipulations.
China's foreign ministry's spokesman Lin Jiang told a press conference on Wednesday that, "cooperation between countries should not target or harm any third party."
A UK government Department for Business and Trade spokesperson said "trade and investment with China remain important to the UK" and it would continue to engage with issues "in UK and global interests".
China expert at think-tank Chatham House, Dr Yu Jie, told the ABC Australia should note Beijing's response, as it considers what to do about the 10 per cent baseline tariff in place on Australian exports to the US.
"The business and economic connection between China and Australia is larger than the UK in terms of the variety of products, also in terms of the variety of imports and exports.
"The Australian government will probably have to weigh in on this more cautiously when they come to deal with Beijing and also Washington."
The UK has been balancing rebuilding relationships with the US, China and European Union after Brexit, while trying not to get any one off-side.
UK Chancellor Rachel Reeves visited Beijing earlier this year to restart economic and financial discussions that had stalled for years.
China is the UK's fifth-largest trading partner, with bilateral trade topping £98.4b ($203b) in 2024.
Dr Yu said the new British Labour government worked to reset relations with China since taking office, but the US trade deal made it more difficult to implement a consistent policy agenda with Beijing.
She said it remained to be seen how Beijing might respond against the UK, but it could involve import rules for certain British companies, similar to restrictions already in place on some US businesses.
Jeffrey Henderson, vice-chair of the China in Europe Research Network, said US clauses around supply chain security and provenance might signal how future trade deals with America will shape up.
He said China would be most concerned about its components being restricted into the British car market, which received a reprieve from the US tariff plan.
Britian also has a significant stake in the pharmaceutical market in the US, but that has limited input from China.
"The US government may be using the British trade deal as a demonstration, in other words, 'this is how we propose to proceed in the future, so those of you have a major Chinese presence in your supply chains, and whatever products you're sending to the United States, then beware,'" Professor Henderson said.
The professor emeritus at the University of Bristol said it was clear that China's reaction showed it was prepared to "retaliate" if its businesses were squeezed out of international supply chains.
The tensions over the trade deal came as China confirmed a pause on non-tariff measures against 17 American entities.
China's commerce ministry announced a 90-day pause on the US businesses placed on its unreliable entities list.
Foreign organisations on the list are barred from importing, exporting and investing in China.
Another 28 US businesses on China's export control list will also receive a 90-day reprieve.
The announcement comes after China reduced most tariffs on US goods to 10 per cent from 125 per cent, following a deal with the US.
America dropped its new levy on Chinese goods to 30 per cent, with the new tariff measures came into effect just after midnight on Wednesday in Washington, local time.
ABC/wires