China's mega-embassy plan tests Keir Starmer's loyalties as Donald ...

By contrast, China’s super-embassy would give Beijing’s official presence in the UK an enormous, prestigious location that Trump might have liked for the US.

Matthews said: “If the Royal Mint becomes the Chinese embassy – a bigger, more prestigious location – that sends the message, whether intended or not, that China is potentially seen as more important ... and that actually China is the country with the greater amount of influence and prestige within the UK.

“So, there would be a bit of an impact, given that the Trump administration on China is going to be extremely hawkish. An awful lot of Trump’s foreign policy vision is seen through the lens of the US’s competition with China. There’s going to be a lot of pressure on US allies, including close allies like the UK, to fall in line with that approach. And it probably won’t send the message that Trump would want to see.”

In the meantime, Britain’s own efforts to refurbish its embassy in Beijing have stalled while the process for the London application is under way.

Matthews said: “Beijing sees that relationship between the two embassies being rebuilt as a reciprocal one, and they have been disappointed in the past that the UK [Government] has not gotten involved in the decision, the way that it now has.”

Mr Matthews said rejecting the plans would “cast a shadow over the UK Government’s plans to engage with China”.

He added: “We’d see a cooling-off of the slight warming of relations that we have seen over the past few months.

“Ultimately, both countries have to deal with each other, but from Beijing’s perspective, the UK needs China more than China needs the UK.

“A refusal would also fit into their existing understanding that the UK is essentially a proxy for US interests. This will fit into that pattern that, from their point of view, the national security concerns are overblown, the human rights issues are none of the UK’s business, and the UK would be seen as sabotaging relations unnecessarily from that point of view.”

Duncan-Smith says that if Rayner decides to give the application the thumbs up, there is “a very good chance the Government will lose the chances of doing a trade deal with the one person who’s going to be in the White House who really does like Britain”.

“The one place it needs to cosy up to very fast, which is a growing economy, speaks our language, uses very similar laws, and therefore would make a much easier arrangement than anybody else in the short term, has got to be the United States,” he says.

“America is the largest investor in the UK, and the UK is the largest single investor in the US.

“We run a surplus in trade with the US, which is considerably different from Europe, and certainly a million miles different from China. Why not maximise that instead of maximising [with] China? And that’ll be the question on the decision.

“It boils down to: the decision on the embassy is going to offend somebody. Who do you think is worse to offend?”