China hopes to capitalize on UK exit from the Eurozone

With the UK set to exit the Eurozone, Beijing is hoping that its goods and services can penetrate a market once marked by heavy regulation. The United Kingdom and the European Union are currently in negotiations over what a post-Brexit Europe will entail. The UK is due to leave the Eurozone by March 2019. Hoping […]

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Britain's Chancellor of the Exchequer Philip Hammond (C) attends the UK-China Economic Financial Dialogue at the Diaoyutai State Guesthouse in Beijing on December 16, 2017. / AFP PHOTO / POOL / FRED DUFOUR

March 8, 2018

With the UK set to exit the Eurozone, Beijing is hoping that its goods and services can penetrate a market once marked by heavy regulation.

The United Kingdom and the European Union are currently in negotiations over what a post-Brexit Europe will entail. The UK is due to leave the Eurozone by March 2019.

Hoping to fill that void, Beijing is courting the UK with its goods and services and the promise of new markets throughout Asia.

Bilateral trade between the two countries increased by 6.2% over the previous year and stood at over $79 billion, with British export to China up by nearly 20% in 2017.

In the same year, Chinese investors brought nearly $1.5 billion into the UK with investments throughout the country and not just major metropolitan areas.

Trade and economic cooperation has expanded from traditional areas such as processing, manufacturing, energy and telecommunications to new and high-tech industries such as new energy, fintech and AI (artificial intelligence).

Major cooperation projects, including the Hinkley Point C nuclear power plant and the ABP Royal Albert Dock, went smoothly.

China’s Ambassador to the United Kingdom Liu Xiaoming, at a recent luncheon for the banking community in London, hailed the new ‘golden era’ between the two countries.

“In the UK, the negotiations to leave the EU marked the beginning of a new historic stage of “global Britain,” he said.

Both Liu and Beijing have been pushing for the United Kingdom to enter in to Xi Jinping’s Belt and Road Initiative.

The United Kingdom became, under the May government, the second country to contribute to Beijing’s Asian Infrastructure Investment Bank and also pledged 25 billion pounds sterling in support of Belt and Road Initiatives throughout Asia.

May and Xi

Both Theresa May and Xi Jinping have gone to great lengths to show there is room for potential cooperation and economic growth. Xi’s ambassadors and foreign ministry have repeatedly called on the United Kingdom to become a strategic partner in the Belt and Road Initiative.

May’s government, meanwhile, has used China’s seemingly limitless market and clout in Asia as a reason to leave the EU and its regulations and bylaws.

Earlier this year, May visited China on a three-day state visit. Observers in the region noticed that the prime minister left Hong Kong off her travel plan, something unfathomable two decades prior.

“May has clearly realized it is now wise to keep political relations with Beijing separate from commercial and cultural relations with the Hong Kong Special Administrative Region. The success or failure of the Brexit project obviously depends on the UK strengthening her historic links to parts of the world outside Europe, and becoming once again a major maritime trading power,” said former British diplomat Tim Collard.

Intellectual and Practical

In the buildup to Brexit, both countries have initiated forums and think tanks to address areas of cooperation. British academics from the University of Birmingham and other red-brick universities have visited China and made statements supportive of China’s growing role in the world ahead of the 19th national congress of China.

Julian Beer, deputy vice-chancellor at Birmingham City University, said, “The way President Xi Jinping has conceptually articulated China’s version of socialism and reinterpreted it for the future is a helpful glimpse into the way China views its role in the world, both now and going into the future.”

A separate forum held at Cambridge, UK in March 2018, focused on ways both countries can contribute to build better human settlement environments. A joint declaration was made, titled the Cambridge Manifesto, and focused on several joint projects, including bringing UK city designers to Chinese cities like Shenzhen and Chongqing to help develop sustainable residential communities.

In Universities across Britain, the number of Chinese academic continues to grow. There are currently more than 6,000 Chinese scholars working in more than 150 British universities, with over 500 professors and a number of fellows, says Wang Yongli, minister counselor for education at the Chinese embassy in London. But just 20 years ago, it was hard to find even one Chinese professor working in the UK, says Wang.

Professor G.Q. Max Lu, vice-chancellor of the University of Surrey, said that overseas Chinese academics should give full play to their advantages to promote exchanges between China and the West.

 

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