Diplomat Magazine- China Report: A Golden Time For China-UK Relations

The following articles have been published in Diplomat Magazine:

A ‘Golden Time’ of China-UK Relations

China’s Ambassador in the UK Liu Xiaoming says the relationship is the result of tireless work building political trust, economic cooperation, cultural partnership and coordination on global issues

Back in February in his Chinese New Year message, Prime Minister David Cameron referred to 2015 as the ‘Golden Year’ for relations between China and the UK. He later went on to envision a ‘Golden Time’ for China-UK relations in the coming five years. This coincides with China’s vision, and has gradually become a consensus between Chinese and UK leaders, who have agreed to jointly initiate a ‘Golden Time’ for China-UK relations.

In October, at the invitation of Her Majesty The Queen, President Xi Jinping will pay a state visit to the UK. This will be the first state visit by a Chinese President in ten years. The historic significance of this visit cannot be overstated. It is expected to mark a new milestone for the China-UK relationship.

The ‘Golden Time’ is dawning but it has not come overnight. It is, rather, a result of tireless work in building political trust, economic cooperation, cultural partnership and coordination on global issues.

High-level, intensive interaction and in-depth dialogues have set the tone for the China-UK relationship.

Over the past decade, visits and exchanges between the UK and China’s leaders have been frequent and institutionalised, including five rounds of annual prime ministers’ meetings. These have provided important guidance to China-UK exchanges and cooperation in various fields.

2015 has seen China-UK relations fast-tracked. March saw The Duke of Cambridge pay a successful visit to China — the most important royal visit to China in nearly 30 years. In May, shortly after the new UK government was formed, Prime Minister Cameron was on the phone with Premier Li Keqiang and the two leaders agreed to work together to bring China-UK relations to a new and higher level. In August, a fresh round of China-UK Strategic Dialogue was held. And September will witness, in succession, the Third Meeting of the High-Level People-to-People Dialogue and the Seventh Meeting of the Economic and Financial Dialogue.

Productive and win-win cooperation has laid the solid foundation for the China-UK relationship.

China is the UK’s fourth largest trading partner. In turn, the UK is China’s second largest trading partner and number one investment destination in the EU, as well as an overseas trading centre for Renminbi (RMB), second only to Hong Kong.

Trade in 2014 increased by 15.3 per cent year-on-year and totalled over US$80 billion. The first half of this year registered US$36.74 billion worth of trade in goods. Mutual investment has soared over the past three years, with inward investment from China surging by an average 85 per cent every year and tripling the total of the previous 30 years. As of 2014, Chinese direct M&A in the UK amounted to US$7.1 billion and investment stock stood at over US$40 billion. These investments covered a wide range of fields, from infrastructure and commercial property, to R&D centres and high-end manufacturing.

The UK has invested almost  US$20 billion in China and invested in 287 new projects in 2014. Following the launch of off-shore RMB business in London in 2011, the UK has taken a number of unprecedented steps, including signing the currency swap agreement with China, obtaining RMB RQFII quota, issuing RMB denominated treasury bonds and opening the RMB-clearing bank.

Last March, the UK announced its application for membership of the Asia Infrastructure Investment Bank (AIIB) established on China’s initiative. This again put the UK in the lead among all developed nations. China is ready to work with the UK and other countries to build AIIB into a new type of twenty-first century multilateral development bank, one that meets high international standards, that is professional, efficient and transparent, and will contribute to development in Asia and the rest of the world.

Strong cultural exchange and people-to-people bonds have brought the people of the two countries closer, providing lasting power for the development of the China-UK relationship.

2015 is the first-ever Year of China-UK Cultural Exchange. The UK Season in China in the first half of 2015 has come to a successful conclusion. Now is the time for the China Season in the UK, entitled ‘Creative China,’ which will roll out a rich variety of 66 events across Britain, including visual art, design, theatre, music, dance, film, sports and exchanges between think-tanks. It will showcase China’s cultural heritage and the latest developments in its innovative industry.

Education is another important area of cooperation. In the UK, there are over 150,000 Chinese students, 27 Confucius Institutes and 113 Confucius Classrooms, which is more than any other European country. In China, the UK is running nine joint education institutions and 235 projects. Local governments in both countries have accelerated mutual exchange and cooperation, with 51 pairs of provinces, counties and cities having entered into a sister relationship. The number of Chinese tourists coming to the UK, 230,000 in 2014, has been growing over the past five years, and could reach 650,000 by the year 2020 according to British estimates. In addition, new Consulates were opened in Wuhan and Belfast to better facilitate people-to-people exchange.

Close collaboration on global issues reflects the global and strategic nature of China-UK relations.

This year the world marks the 70th anniversary of the victory of the world anti-fascist war and the founding of the United Nations. As permanent members of the UN Security Council, China and the UK have resolved to build a close partnership and jointly respond to the global challenges of the twenty-first century.

China is ready to work with the UK and the international community to safeguard the victory of World War II, to uphold the purposes and principles of the UN Charter, to strive for the building of a new type of state-to-state relations based on win-win cooperation and to maintain world peace and promote development. On global and regional issues such as Ebola, Iran and South Sudan, China and the UK have maintained close cooperation. Both countries have played an important and constructive role in the search for appropriate solutions to these issues. And both will continue to carry out coordination and cooperation on the global development agenda, climate change and global terrorist threats. The two countries will work together to maintain openness in the world economy and push for the building of a fair, just, inclusive and orderly international financial system.

A more mature and stable China-UK relationship will make it possible for bilateral cooperation to expand in scope and depth, and for mutual interests and win-win cooperation to grow. This will bring tangible benefits to the people of both countries and will contribute to world peace and development. As the long-expected State Visit by President Xi Jinping is approaching, we are ready to work with British colleagues to ensure the success of the visit and embrace the ‘Golden Time’ of China-UK relations.

A WONDER OF THE MODERN WORLD

With its 60 years of experience, Chairman of the 48 Group Club Stephen Perry recounts how the organisation is ideally placed to provide unique insights into how China is changing our world

The 48 Group Club journey with China began with the formation of the London Export Corporation in 1952 to help reopen trade between China and Western Europe.

 London Export, led by my father, then organised the ‘Icebreakers’ mission to China in July 1953. These 18 people took seven days to reach Hong Kong and then three days to get to Beijing. The first purchases of traditional Chinese exports such as tea and silk, feathers and casings, and the sales of chemicals and machinery were greeted with curiosity, and some envy, from those who espoused a policy of containment and boycott.

 The 48 Group led many missions to China over the next 37 years and helped many companies develop sales and purchases. The 48 Group always enjoyed preferred supplier status. This was China’s recognition of the tireless work carried out by the 48 Group to promote positive relations and develop bilateral trade.

 It also gave the 48 Group leaders the chance to witness China’s transformation and to see the challenges and problems that this new nation encountered. Water was brought to the land by canals built by hand. Diseases rampant across China were contained by countless ‘barefoot doctors,’ farmers who received minimal basic medical training and worked in rural villages across the country.   China has come from abject poverty and isolation to the global position where it is today. It is a wonder of the modern world.

 As China learnt from their experiences they began the process of turning politics and their deep civilisation towards economic development. In policies first contemplated by Mao and Zhou Enlai, Chinese statesman Deng Xiaoping eventually led them from 1978 onwards, following the tumultuous years of the Cultural Revolution.  In just 37 years, China had amassed a foreign reserve worth over US$3 trillion following its focus on exports and entering the World Trade Organisation (in 2001).

 Now China is  entering a new era, opening up its economy, and working with neighbouring nations to enable them to share China’s prosperity. The development of the domestic market combines a policy of shared prosperity with its neighbours. This all links in with China’s Silk Roads that will connect East Asia with Eastern Europe, through to the Atlantic Ocean. A new infrastructure market of over US$8 trillion will see high-speed rail lines, canals and highways creating new towns and cities across Eurasia.

 Already much is going on inside China and beyond its borders. New links to and through Pakistan link new routes to the Indian Ocean and East Africa.

 China’s official currency, the renminbi (RMB) is fast becoming an international currency. The two special administrative regions, Hong Kong and Macau, have their own respective currencies, according to the ‘one country, two systems’ principle and the basic laws of the two territories. These are not two competitive systems but two different systems for developing the world. One system based upon Asian culture and history in Asia, and another based across the Atlantic in a familiar form. China wants to participate in both systems and enable prosperity to develop across the world, although they see their main contribution in the developing world, where China’s development can help other nations.

 President Xi Jingping leads a highly successful government and party, and reflects the ideas and policies of many hundreds of thousands of very capable people. We only have to look at the fact that China has been the largest economy in the world for 18 of the past 20 centuries, and to see the country’s enormous contributions to science and civilisation to gain some sense of their impact on the world in the decades ahead.

 China is good for the West and President Xi’s upcoming State Visit will reinforce that message. China is expressing its newfound confidence and position as the second largest economy in the world. The country is going through a phase of market forces and releasing the potential of their companies globally – going global.

 The UK and China are entering a phase of a special economic relationship, which requires high-level attention and constant focus. Both nations need to understand each other better for the dividends to increase. The UK can be an important Western territory for Eurasia’s new century.

 Listen carefully to what President Xi has to say. It is meaningful, and contains the seeds of China’s future and much more.  Their campaign against corruption in official and state-owned enterprises is part of an operation to recover the soul of China from the excesses of the past 37 years. It will go on and go deeper as non-corrupt officials are a key to China’s next stage, and the one beyond.

 Enjoy seeing a nation return to the forefront of global development. A very rare event. www.the48groupclub.com

Stephen



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