The long list of commercial agreements reached during the State Visit by President Xi Jinping is a sign of the strength of partnership the UK and China could have.
The recent State Visit by President Xi Jinping to the UK marked a triumphant culmination of UK-China relations for 2015 – and the third high level bilateral engagement of the year.
The first two focused on particular sectors of strength. Prince William’s visit in March spearheaded a UK-China creative industries campaign. Then, in September, Chancellor George Osborne chose to highlight the ‘complementarity’ of the UK-Chinese economies with a keynote speech at the Shanghai Stock Exchange.
But the four-day state visit by President Xi Jinping and China’s First Lady Madame Peng was undoubtedly the jewel in the crown of UK-China relations.
Nearly £40bn worth of commercial deals were agreed upon spanning a wide range of sectors, such as energy, retail, financial services, aerospace, healthcare, transport, education and the creative industries.
Energy dominated with the largest deal announced – EDF’s and China General Nuclear Power’s commitment to build and operate Hinkley Point C nuclear power station – valued at approximately £25bn. This was reciprocated in some way by BP’s multi-billion dollar LNG deal with Huadian.
Sustainability was also on the cards, as China Equity and Aston Martin are now set to develop an electric version of the Rapide sports saloon. Other low carbon partnerships and R&D funding for sustainable urbanisation were also announced.
Long-term plan, immediate benefits
Ambitious plans were discussed to support China’s “One Belt, One Road” vision to rebuild Silk Road trade links with Asia and Europe. And Manchester Airport announced plans to host the first direct scheduled flight to mainland China outside of London; while Rolls Royce signed a $2.4bn agreement to power HNA Group’s new aircraft.
The emphasis fell on the long-term. Crucially a UK-China joint statement was released which set out plans to build a “comprehensive strategic partnership for the 21st Century”. This reinforced the UK’s ongoing bilateral relations with China, in particular the annual Prime Minister’s Meeting and the Economic and Financial dialogue (EFD).
But perhaps the most immediate – and potentially most wide-reaching – announcement was a significant change to UK visitor visas for Chinese tourists.
From January 2016 new visitor visas will be valid in the UK for two years – four times the usual six-month limit for a standard visa – which will bring significant economic benefits to the UK economy.
Currently Chinese tourists contribute £500m to the UK economy – a figure likely to increase significantly in 2016. Indeed average per-person spend by Chinese tourists in the UK is the highest of all international visitors at £2,688.
And away from the pomp and ceremony of the visit, two significant global healthcare initiatives stand out with the UK and China agreeing to establish a Global Antimicrobial Resistance Research Fund and Warwick University partnering with Sun Yat-Sen University Centre on cancer research.
The key focus now will be on ensuring that the good will, agreements, and deals signed during President Xi’s highly successful UK visit do indeed lead to a golden era for UK-China relations.