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"Every company that I speak to at the moment is engaged in
rethinking their supply chains ... because they anticipate that
our politicians will inevitably accelerate towards a decoupled
world from China," CBI Director-General Tony Danker was quoted
as telling the Financial Times newspaper.
China was Britain's biggest source of imported goods in 2021,
accounting for 13% of the total, while it was the sixth-largest
destination for goods exports, according to Britain's official
trade statistics.
However, British security concerns have risen in recent years,
fuelled by disagreements with China over Hong Kong and other
issues. Last week, the head of Britain's foreign intelligence
service, Richard Moore, said China was now his top priority,
ahead of counter-terrorism work.
Britain has also increasingly blocked Chinese takeovers of
companies on national security grounds.
Both the remaining candidates in the Conservative Party
leadership contest - Foreign Secretary Liz Truss and former
finance minister Rishi Sunak - have said they intend to take a
tougher line on China.
Danker said growing U.S. concern about China had also made
British companies more wary about being dependent on Chinese
suppliers, and that going elsewhere was would be "more expensive
and thus inflationary".
"It doesn't take a genius to think cheap goods and cheaper goods
may be a thing of the past," he added.
British inflation hit a 40-year high of 9.4% last month, partly
because of the surge in energy prices caused by Russia's
invasion of Ukraine.
(Reporting by David Milliken; Editing by Helen Popper)
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