TAIPEI, Taiwan — On Saturday, China and Britain resumed their economic and financial discussions after a six-year break, coinciding with the British Treasury chief’s visit to Beijing. The meeting comes as the Labour government in the U.K. looks to mend its strained relationship with one of the world’s largest economies.
Chancellor Rachel Reeves traveled to Beijing with a team comprising British business executives and finance officials and engaged with prominent Chinese leaders, including Vice Premier He Lifeng and Vice President Han Zheng. Reeves highlighted the importance of establishing a “stable, pragmatic” relationship between the U.K. and China, emphasizing the significance of collaboration on mutual interests while maintaining transparency regarding disagreements.
The relationship between China and Britain has been tested due to various factors, including spying allegations from both countries, China’s support for Russia amid the Ukraine conflict, and crackdowns on civil liberties in Hong Kong—a former British territory. During her discussions, Reeves indicated that she would stress the necessity for China to cease its material and economic assistance to Russia and raise concerns about human rights conditions in Hong Kong.
In the course of the meeting, both nations signed agreements projected to contribute “600 million pounds ($732 million) to the U.K. economy” over the next five years, according to Reeves, although she did not provide detailed breakdowns of the agreements. She expressed a broader ambition that this re-engagement could lead to an estimated 1 billion pounds of value for the U.K. economy in the future.
Reeves’ three-day visit occurs amidst turbulence in the bond markets, which has resulted in borrowing costs reaching highs not seen since the 2008 financial crisis. Critics from the opposition Conservative Party accused her of prioritizing this trip over addressing pressing economic issues related to inflation and stagnation back home.
In a column for the Times of London, Reeves argued that engaging with China presents a substantial opportunity for growth, noting that China is the U.K.’s fourth-largest trading partner, with British exports supporting nearly 500,000 jobs within the country. She stated, “Choosing not to engage with China is therefore no choice at all.”
The discussions marked the reinstatement of the China-U.K. Economic and Financial Dialogue—annual negotiations that had been paused since 2019 due to the pandemic and declining diplomatic relations. London aims to harness these renewed talks to dismantle obstacles that British businesses confront when attempting to export or expand operations into China.
Reeves articulated the significance of fostering exchanges in areas such as sustainable finance, capital market integration, pensions, regulatory alignment, trade, and investment, while being cautious that these economic ties do not compromise national security and economic resilience.
She expressed her support for China’s plan to launch its inaugural overseas sovereign green bond in London this year, while also focusing on eliminating barriers to market access for goods and services. Reeves mentioned efforts to unlock initiatives in agrifood sectors expected to enhance U.K.-China trade relations.
Vice Premier He endorsed the shared commitment to removing barriers for investment in critical sectors, including clean technology, life sciences, digital technology, and financial services. The British delegation encompassed high-ranking officials such as the Bank of England Governor and the heads of major financial institutions like HSBC and Standard Chartered.
Reeves’ visit follows recent engagements by other British officials, including Foreign Secretary David Lammy’s trip to China in October, and Prime Minister Keir Starmer’s meeting with Chinese President Xi Jinping in November. Starmer aims to bolster political and economic relations with China, viewing it as a key player in global trade.
However, his approach has faced criticism, with skepticism from some members of the Conservative Party regarding the importance of national security and human rights in trade discussions. British leaders and intelligence officials have often warned of potential security threats posed by China, increasing scrutiny after reports surfaced regarding an alleged Chinese spy’s close ties with Prince Andrew, who was accused of engaging in covert activities for the Chinese Communist Party.
“National security is the foundation of what any government acting in the national interest will prioritize,” emphasized Reeves. “However, it is essential to maintain pragmatic and constructive relations with countries worldwide, which is ultimately in our national interest.”
