Email leak shows Treasury fear of upsetting China

THE Government has been accused of ‘appeasing Beijing’ after a leaked email revealed that a top Treasury official had warned Downing Street against ‘antagonising’ China.

The mandarin emailed a senior official in the Cabinet Office to criticise a drive by Japan against China’s economic bullying of smaller countries.

This month Japan took over the presidency of the G7 rich countries’ club and is trying to co-ordinate a major international push to stand up to Beijing.

Japan accuses China of ‘economic coercion’ by refusing to do business with smaller countries that don’t support its policies – and is holding one-on-one calls with other G7 nations.

But the Treasury official, who is responsible for Britain’s response to the G7 plan, warned Downing Street that it risked angering China without benefiting the UK.

The official wrote in the email: ‘As I suspected, the Japanese agenda is more words than outcomes and we’ll need to fix that with the others. In some ways all talk without concrete action is the worst of both worlds as we would have antagonised [China] without having strengthened our resilience and preparedness.’

Last night, former Tory leader Iain Duncan Smith told The Mail on Sunday the leaked email showed that ‘deep in the heart of the British Establishment, Operation Kowtow is in full effect’.

Mr Duncan Smith – who has argued that the Government is too keen to pander to China despite its aggressive foreign policy and violation of human rights – added: ‘Not content with appeasing Beijing, it seems the Treasury is also keen to limit international efforts to curtail its abuses.’

Tokyo said earlier this month that it wanted the G7 countries to take a

‘All talk without action is the worst of both worlds’

co-ordinated approach aimed at preventing the ‘economic coercion’ China has applied to some of its trading partners, such as suspending the imports of Taiwanese pineapples and Australian wine.

Yasutoshi Nishimura, Japan’s minister of economy and trade, said he expected ‘effective responses to economic coercion’ to be ‘a major item’ at this year’s G7 summit.

Beijing hit back by accusing the G7 of protectionist measures to prevent its economic rise, including the US controls on the export of semiconductors to China.