The White House has urged Downing Street to block plans for a new Chinese “super embassy” near London’s financial districts.
Construction of the building was blocked amid espionage fears from local residents, as well as human rights campaigners and politicians.
But the plan has been revived, with Angela Rayner “calling in” the decision last year and ministers due to make the call on whether the hugely-controversial embassy should go ahead.
China’s President Xi Jinping is said to have personally lobbied No 10 for the complex at Royal Mint Court in East Smithfield.
It is also believed Chinese foreign minister Wang Yi brought up the matter with Foreign Secretary David Lammy while visiting the capital last year.
The proposed site lies directly between the City of London and Canary Wharf and close to three significant data centres.
Security experts say its proximity to critical communication cables makes it susceptible to a possible cyber attack.
It is understood that US President Donald Trump has warned Prime Minister Sir Keir Starmer against giving the project the go-ahead.
The matter is believed to have been discussed during trade talks, with American diplomats trepidatious about sharing intelligence with British allies if the embassy went ahead.
It is understood the situation has threatened to derail negotiaitons on a US-UK trade deal, with the Mail on Sunday reporting Washington has asked for a “China lock” as part of the talks, which would guarantee the development will not present a security threat to the US
A senior US official told The Sunday Times: “The United States is deeply concerned about providing China with potential access to the sensitive communications of one of our closest allies.”
It comes after claims “dark cabling” running beneath the proposed site “feeds the City” were handed in a memo to the US National Security Council by members of the Inter-Parliamentary Alliance on China.
John Moolenaar, a Republican congressman from Michigan and head of the House of Representatives' China committee, claimed the site would “pose an unacceptable risk” to both London and Washington.
“The Chinese Communist Party has a clear track record of targeting critical infrastructure,” he said. “This development would raise serious concerns in the United States and could be viewed as an act of strategic overreach by Beijing and a curious error in judgment by London.”
Luke de Pulford, executive director of IPAC, dubbed the matter as a “flashpoint” in discussions on how UK steel producers could avoid being lumbered with 50 per cent import tariffs from next month.
He added: “It's time to send Xi Jinping a clear message: no matter the pressure or coercion, the UK and US won't trade away national security, and this embassy isn't happening.”
The proposal for the China's embassy, the country’s largest in Europe, was previously rejected by Tower Hamlets Council in 2022.
However, a fortnight after Chancellor Rachel Reeves came back from a visit to Beijing in January, both the local authority and Scotland Yard's objections were dropped.
Beijing resubmitted its plans in August without making any major changes.
Priti Patel, the shadow foreign secretary, branded China a "dangerous threat to the national and economic security of our country”.
While on Sunday in response to the White House intervention, Shadow home secretary Chris Philp said allowing a Chinese embassy to be built near London’s financial centres “is a security risk” and permission should not be given.
“In government the Conservatives were very clear, we should not be allowing the Chinese to build this super-embassy”, he said.
“It is likely to become a base for their pan-European espionage activities and it sits very close to, of course, the UK’s financial centre, it’s very close to three critical data centres… data cables connecting for example Canary Wharf to the City, run very close or indeed even underneath the site, and it is very likely the Chinese would use it to organise espionage activities.
“We’ve seen the Chinese government cracking down on dissidents, running secret police stations in the UK, even putting bounties on the heads of dissidents, some of whom I’ve met. We should not be giving permission to this.”
China previously quashed any spy allegations, stating: “Anti-China elements are always keen on slandering and attacking China.”
A UK Government spokesman said: “Applications for a new Chinese embassy in Tower Hamlets have been called in for ministers to decide. A final decision will be made in due course.”
Technology Secretary Peter Kyle told Sunday Morning With Trevor Phillips on Sky News: “These issues will be taken care of assiduously in the planning process.
“But just to reassure people, we deal with embassies and these sorts of infrastructure issues all the time.
“We are very experienced of it, and we are very aware of these sorts of issues constantly, not just when new buildings are being done, but all the time.”
Asked about the US warning, he said: “These are the issues that we talk about as two countries all the time… we’re in the Five Eyes agreement, America and Britain share intelligence… We are one of the few countries in the world that share intelligence.”
Mr Kyle added: “If people raise security issues even though it relates to planning, then I’m sure we will have a fulsome response for them. But look, the key thing is, these are issues which are quite routinised in the way that we deal with the security of our country.
“This is not new. It’s going through planning. These are issues that will be dealt with in that process.”
