CBI submits evidence to parliament on trade with China

The CBI has submitted evidence to the International Trade Committee’s inquiry on UK trade with China. Covering topics such as; how the UK should approach its trade and investment relationship with China; and whether this should take the form of a Free Trade Agreement or the continued pressing of market access concerns to the Chinese Government, the inquiry is wide ranging.

Why is China important?

Focusing on the fact that UK trade with China has been growing by close to 20% year-on-year, the CBI submission stresses the importance of the UK’s economic relationship with China and the potential to grow services exports within the market.

How should the UK structure its economic relationship with China?

With regard to whether the UK should immediately look to sign a Free Trade Agreement with China, once trade is no longer an exclusive competency of the European Union, the CBI advised that in the short term, it would be better to focus on securing market access wins and investment protection for British business in China rather than a fully comprehensive Free Trade Agreement.

Where is there opportunity for UK plc in China?

To this end, the CBI’s submission highlighted the fact that the UK’s knowledge base in advanced manufacturing and information and communications technology overlaps with China’s priorities in areas of weakness. Moreover, these are areas where CBI members with interests in China are keen to further collaboration with China, with business keen to stress that cooperation between the two countries - and across a wide range of sectors - holds significant potential to bring benefits to both.

What has the CBI advised?

The CBI has asked parliament to advise that the UK seek out a unique position on China and whether Chinese companies and their investments into the UK present a national security threat. Within the current geo-political climate, were the UK to be forced to have to choose between the U.S. and China, it would be facing an artificial choice. It is therefore in the interests of British business that opportunities to strengthen the UK’s economic relationship with China be considered on a case-by-case basis, considering whether closer engagement with China in certain sectors is in the UK’s best interests.