Ten years ago Britain and China hoped they were laying strong foundations for a “golden era” of greater trade and co-operation. Now the two countries cannot even agree if either one should be allowed to construct a new embassy.
A dispute over China’s planned “mega embassy” at a site near the Tower of London, and the UK’s desire to carry out a significant rebuild at its long-standing embassy site in Beijing, has sparked a wider cooling of relations some fear threatens to become a diplomatic winter.
China, which bought the former Royal Mint site for £255mn in 2018, this month accused the UK of acting “in bad faith” after it announced a fresh delay to a planning decision. Its proposed building on the edge of the City of London would be the largest embassy in Europe.
The delay until December comes as critics have warned that the embassy could serve as a “spy hub”, with Beijing redacting part of the plans for the site.
The embassy’s critics, who include lawmakers in Washington, have also warned that China could potentially tap into critical data cables running near the site that serve US banks.
China resubmitted its planning permission for the embassy days after Labour won power in July 2024, and Sir Keir Starmer’s government “called in” the application in October last year under powers to intervene on applications of national importance.
The UK prime minister told Xi Jinping in November that his ministers had “taken action” after the Chinese president raised the issue in a phone call. Planning lawyers have suggested that the government may have acted unlawfully if it offered Beijing assurances in advance.
Meanwhile, Westminster has been embroiled in a scandal over a China espionage court case that fell apart over the government’s refusal to tell prosecutors that Beijing posed a clear national security threat.
The fallout has shone a spotlight on the government’s desire to boost trade with China, while highlighting the many ways in which Whitehall considers the country a threat.
With bilateral ties strained, the Foreign, Commonwealth and Development Office’s attempt to ask Beijing to speed up approval of its £100mn plan to remake the British embassy and ambassador’s residence in the Chinese capital has come unstuck.
UK officials insist that renovation plans for the British embassy in China are not linked to a decision on China’s site in London, although Beijing has warned of “consequences” if its plans are not quickly approved.
Starmer this week said he would not be “pushed around” by China. The quasi-judicial decision over the Royal Mint site would be “taken in the proper way, regardless of any views or pressure from anyone”, he told Bloomberg News.
Luke de Pulford, executive director of the hawkish Inter-Parliamentary Alliance on China, a long-standing critic of plans for the embassy, said the UK government faced a difficult choice.
“If the government green-lights the application, they will look weak on China in the midst of a spy scandal, alienate our democratic allies . . . If they refuse permission, Beijing will push back, possibly ending ongoing trade talks and allow our embassy in China to crumble,” he said.
The UK embassy in Beijing has occupied its current site — two, two-storey houses set among gardens in a walled property — since 1959, when the Communist government of Mao Zedong took over the old British Legation property in central Beijing to build a judicial complex.
The current complex has a long history: during the Cultural Revolution in 1967, Mao’s red guards set fire to the building and roughed up staff after British colonial authorities suppressed leftist riots in Hong Kong.
Today the ageing British embassy complex is cramped and the working conditions unsuitable after years of ad hoc renovations to accommodate a growing workforce, according to diplomats. There have been mould problems at the embassy, and an outbreak of maggot infestations in the communal bar. The embassy has done ad hoc renovations to improve conditions, but diplomats say structural work is needed.
According to an FCDO tender in September last year, the UK is seeking approval of a proposed design from Beijing authorities to “demolish and rebuild its new Beijing Embassy, Ambassadors Residence and Staff accommodation block and gatehouses”.
But China’s government has argued that it should have oversight of the renovation and help decide the construction company, a demand the embassy has pushed back on amid concerns about security implications.
Business secretary Peter Kyle raised the subject of the embassy on a visit to Beijing last month to tout opportunities for UK and Chinese companies. “If China wants to get the best out of Britain, it has to allow Britain to have facilities that are fit for the moment we’re living in,” he said. “Right now they are not.”
On a trip this month, Sir Olly Robbins, the FCDO’s top civil servant, pushed China on a £60mn first-phase plan, according to people familiar with the matter.
The first phase envisages demolishing the existing residence and replacing it with a new embassy building, guardhouse and landscaping works. The £40mn second phase would involve the demolition of the current embassy and its replacement with a new residence building, according to the tender.
China’s ministry of foreign affairs in Beijing said: “China has always handled the construction of the British embassy in China in accordance with the relevant laws and regulations.”
Any suggestions that China was going slow on the British application or interfering in the construction plans were “complete fabrications”, it said, adding that China was “sincere” about improving ties with the UK but would also protect its “legitimate interests”.
The FCDO declined to comment.
While some UK officials are hopeful that a resolution can be found, and both sides remain keen to build ties, critics are still urging the UK government to stand firm.
“It is hard to imagine anything more English than Beijing’s grand diplomatic plans being scuppered because they couldn’t get planning permission,” de Pulford said.
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