A range of trade and investment deals, worth £14 million, have been signed between the UK and Chinese firms as the Chinese Premier Li Keqiang met Prime Minister David Cameron during a recent visit to the UK. The UK is the most popular European destination for Chinese investment, as we benefitted from over £8 billion in 2013/14 alone, creating or safeguarding over 6,000 jobs in the UK.
Speaking at the press conference for the UK-China summit today, Prime Minister David Cameron said; “These figures prove once again that Britain is the most open economy in the EU. The most welcoming to Chinese investment, including our nuclear industry and our infrastructure and I’m determined to keep it that way. The UK will continue to stand for opening up trade in the EU, for progress towards an EU-China trade deal, and for free trade within the G20 and the WTO.”
There were a range of trade and investment deals announced during the UK-China summit, including a deal between BP and the China National Offshore Oil Company (CNOOC). They signed an agreement worth £12 billion on the supply of liquefied natural gas. The deal will see BP supply CNOOC with 1.5 million tonnes of gas per year over the next 20 years, starting in 2019.
In addition, MAP Environmental Ltd and Z N Shine Solar entered into a joint venture to purchase, develop, construct and manage £400 million of UK solar PV assets. The project will involve a three year construction programme in conjunction with some of the UK’s largest engineering, procurement and construction contractors: and the on-going maintenance will run for up to a further 20 years. The project will generate up to 50 new UK jobs in design, administration and operation roles; with a further 500 new UK jobs in construction and maintenance created over the period of the contract.
The China Minsheng Investment Corporation (CMI), China’s largest private sector investment group, have also announced that it would open its European HQ in London with an investment of around £1.5 billion. Investments will cover a range of sectors including financial services, advanced technology, offshore engineering, new energy, and environmental protection.
China Merchant Securities (CMS), China’s third largest securities firm in terms of net capital, opened its first London office, which creating at least 40 new UK jobs in its initial stage. CMS will increase the volume of commodity trading in London and play a significant part in the internationalisation of the Chinese currency Renminbi (RMB): reinforcing London’s position as the second largest offshore RMB trading centre.
Furthermore, Nord Engine, a Chinese financial services group will open its first overseas operation in the UK and invest up to £150 million in UK and European small and medium sized enterprises. It will target enterprises in the tech industries, with strong commercial R&D capabilities and work to help them access the Chinese market. This will be the first Chinese institutional support for small and medium sized enterprises in the UK.
The CBI has commented on the visit of Chinese Premier Li Keqiang to the United Kingdom and the trade deals made. Katja Hall, the CBI Deputy Director-General, said: “The United Kingdom’s trading partnership with China is of critical importance to our economic future. From infrastructure projects to digital technology, the UK is the top destination for Chinese foreign direct investment in Europe.
Premier Li’s visit is a welcome demonstration of the ever-deepening importance of that trading relationship. A well-functioning work permit and visa system is vital to ensuring that the UK is a vibrant hub for international trade, visitors and students.”
Chinese Premier Li Keqiang has also been received by the Queen, this happened on the first full day of his three day visit to the UK. It is the first UK visit by a Chinese premier since the discord over Mr. Cameron’s meeting with exiled Tibetan spiritual leader, the Dalai Lama.
Mr. Li has said he aims the trip will help to “change misperceptions and misgivings” about his country, as well as creating further business and cultural ties.
What other trade partnerships could the UK explore to enhance it’s economy?