UK-China investments linked to transfer of military-grade technology

Hadisur Rahman, JadeTimes Staff

H. Rahman is a Jadetimes news reporter covering Business

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A sweeping investigation by BBC Panorama, based on new data from the AidData research group, claims that tens of billions of pounds of Chinese investment in UK firms over the last two decades have, in some cases, facilitated access to technologies with potential military applications.

The report, published this week, argues that the United Kingdom was among the top recipients of Chinese overseas investment relative to its population and economy, raising fresh questions about national security and economic strategy.

AidData’s analysis, drawn from government spending records and corporate disclosures, indicates that a sizable portion of Chinese capital flowed into high-tech sectors such as semiconductors, aerospace, and robotics. Panorama highlights Imagination Technologies, a Hertfordshire-based chip designer, as a focal point of concern. The company’s sale in 2017 to Canyon Bridge, a private equity firm with links to China Reform, is cited as an example of how intellectual property and engineering know-how could be exposed to foreign ownership.

Interviewees, including former industry and security officials, warn that while much investment delivered economic benefits, there were instances where the transfer of knowledge and capabilities might be used to bolster China’s strategic aims. Dr. Brad Parks, AidData's executive director, warns that “Made in China 2025” set explicit goals for leadership in key high-tech domains, potentially influencing overseas deals.

Supporters of inward investment note that the UK has benefited from capital inflows and job creation, and that risks can be managed through stronger screening and export controls. Sir Jeremy Fleming, former head of GCHQ, cautions that the regime must be robust but asserts that the balance between openness and security remains delicate.

UK officials say they are reviewing screening mechanisms and export regulations to close gaps identified by the Panorama investigation. The BBC emphasizes that the report does not accuse all Chinese investment of wrongdoing but calls for tighter oversight to prevent sensitive technologies from leaving the country.