How the UK Can Forge a National Strategy amid Great Power Competition
The next UK government will find itself in a very different world from that of the last General Election in 2019 - one of intensifying great power rivalry between (and beyond) the US and China which is driving bifurcation of the global economy and technology landscape. How the US-China relationship develops, potentially through a second Trump Presidency, has direct consequences for the UK’s national security, economic resilience, and technological competitiveness.
The post-Cold War consensus of the 1990s and early 2000s is now well and truly over, and the challenge for the UK government is to adapt to what is replacing it. Peace and progress are far from guaranteed, requiring long-term planning, including for worst-case scenarios. The rules-based order might still be ‘international’, but it is no longer global; adaptability is key to cultivating multilateral ties to deal with common challenges and shore up common interests. Reshoring and de-risking have become geoeconomic watchwords as the two largest economies attempt to disentangle themselves; for middle powers like the UK, sovereign capability is increasingly essential to avoid dependency in an increasingly fractured world.
Meeting these challenges will be the priority for the UK government after the election – but not just after the election. There are no quick fixes. Adapting to a world in which the US may no longer be hegemonic, and the consequences of that for international norms and organisations, requires a long-term strategy. This means understanding where UK and US interests in countering China converge, but also where they diverge. It means appreciating that the UK’s highly internationalised, service-oriented economy now leaves us vulnerable to economic leverage and disruption of supply chains critical to national security. And it means having a realistic understanding of our capabilities as a senior middle power, playing to our strengths in emerging technologies such as AI, and using these to help safeguard national security and economic resilience.
Priority 1: National Security
It is increasingly acknowledged that Chinese state action presents national security threats to the UK, including espionage, election interference, cybersecurity threats, and misinformation. In these areas, the UK’s interests are best advanced through close cooperation with allies, including through intelligence cooperation (as with Five Eyes) and the harnessing of complementary allied capabilities in critical information and intelligence technologies (as promised by AUKUS Pillar 2). Such cooperation is all the more vital given Russian and Iranian attempts to disrupt Western democracies, and the degree to which China seeks to foster and exploit such disruption.
The UK’s close security relationship with the US remains vital. However, while UK and US interests converge in safeguarding national security, when it comes to China our military interests are less aligned. As an East Asian power, China is not a direct military threat to the UK in the way that Russia is, and the UK does not necessarily share the US’ concerns with maintaining military hegemony in in the Indo-Pacific. The next government will face the challenge of adapting the special relationship to the realities of the US’ changing global role.
This will remain true regardless of the UK Prime Minister’s new counterpart in the White House. But a second Trump Presidency could compound it through significant shifts in US international priorities, particularly regarding the US’ commitment to European security. This could have huge implications for the long-term sustainability of NATO and the UK’s much more pressing military interests in being able to counter Russia. Increasingly, the UK government will find itself in a world of strategic trade-offs, and again, clear-eyed long-term and contingency planning are key. Trump or not, US domestic politics are shifting, and a subsequent isolationist administration is far from inconceivable. The UK government will need to make hard choices about where best to direct limited resources to safeguard national security and shore up military capability where it is most needed.
Priority 2: Economic Resilience
COVID-19 and the Russia-Ukraine war have demonstrated the need for secure supply chains. China’s dominance of key strategic sectors like critical minerals, and of crucial new technologies such as electric vehicles and renewable energy, present a major long-term challenge. Regardless of whether China displaces the US as the world’s leading power, its rise has already, and likely irreversibly, disrupted the global US-led world order and the economic norms that entailed.
China’s dominant position in international supply chains, combined with its capacity and precedent for economic coercion and state assistance to ensure international competitiveness, have already prompted the US to reinvigorate its industrial base and the EU to develop anti-coercion instruments. The UK must likewise guard against coercion and take steps to mitigate overdependence on vulnerable supply chains. This cannot be done without improving supply chain visibility, and a key priority should be to harness new technologies such as AI to support this analysis. This needs to go beyond logistical tracking and must lead to an understanding of geopolitical chokepoints and the influence of allies and adversaries over source and intermediary countries.
Long-term contingency planning is essential. The UK is caught between a close alliance with the US and economic dependence on both the US and China. Although the UK will be under increasing US pressure to align economically against China, it is sensible planning to balance its common interest in this with its existing exposure to China in key supply chains and other areas of major economic importance such as higher education. In the event of a US-China conflict, economic and political decoupling between the two superpowers – what we term “the Great Split” - would far outpace any country’s ability to mitigate the economic fallout. Regardless of the UK’s positioning on any such conflict, a potential Great Split would be likely to lead to supply chain disruption and economic damage beyond anything in living memory.
Catastrophic great power conflict aside, the emerging global reality necessitates a major economic shift for the UK. Industrial strategy and sovereign capacity are key to reducing supply chain dependencies and maintaining a lead in key areas of technology. This requires a long-term view – not just the next election, but decades into the future. But as the international scope of the US-led rules-based order contracts under Chinese pressure, so too does the pool of partners the UK can rely on for multilateral reshoring efforts and free trade agreements. Efforts to further these should still be pursued, particularly where they reduce dependence on China and other strategic competitors, but they need to be accompanied by a far more robust government attitude to support for UK sovereign firms. Reduced dependency on China is desirable, but if that translates into even greater dependency on US firms for UK economic prosperity, that prosperity remains at risk as US economic interests become more domestically-focused.
Priority 3: Technological Competitiveness
A key area where a revised industrial strategy and the further development of sovereign capabilities will reap rewards is in emerging technologies. AUKUS Pillar 2 provides a solid multilateral basis for technological cooperation between the UK, US, and Australia, as well as enhancing capacity to compete with China. To make a success of it, the UK will need to invest the resources necessary to enable to British tech firms to maintain competitiveness.
While the UK cannot match the capabilities of the US and China across the board, it nonetheless boasts world-leading capability in critical areas of technology. AI is one of these, and if harnessed effectively has the potential to help meet the challenges of national security, economic resilience, and technological competitiveness.
As well as accelerating intelligence capability and mapping supply chain vulnerabilities, AI offers unprecedented capabilities in terms of mapping technological research and markets within and beyond the UK, to allow decision-makers to track developments and anticipate research and market trends to gain competitive edge. AI can also be harnessed to conduct due diligence research prior to international collaborations through nuanced assessments of the risk of working with, say, Chinese research institutions.
Targeted investment in sovereign capability is key here, backed by a clear focus on specific technologies and a strategy to secure and maintain the supply chains critical to technological innovation and development. An industrial strategy which fosters close cooperation with allies is absolutely in the UK’s interests, providing the UK retains sovereign capability.
Forging a Path
The effects of the US-China relationship on global geopolitics are of direct consequence for the UK. They do not mean business as usual; fundamental shifts in the UK’s approach to national security, economic resilience, and technological competitiveness will be key to navigating the world of 2024 and beyond. By clearly understanding where our common interests align with those of our allies to safeguard national security, supply chain resilience, and technological cooperation, by harnessing emerging technologies, and by providing long-term support for UK sovereign capability, the UK will be able to forge a successful path forward in a world of great power competition.
Authors
Dr William Matthews
