On Wednesday 31 January, Theresa May set off on a three-day trip to China - her first official visit since becoming UK Prime Minister.
Theresa May arrived in Wuhan with a delegation featuring over 50 business leaders, including Pascal Soriot, CEO of AstraZeneca, Mark E. Tucker, chairman of HSBC, and Nikhil Rathi, CEO of the London Stock Exchange Group.
The official visit was highly business-motivated. With the UK negotiating terms for its imminent EU departure, the government is looking to strengthen its ties and business alliances with the world beyond Europe. While the UK and China already have a positive working relationship, now is a great opportunity for both sides to pay particular attention to that bond.
Prior to the trip, China’s UK ambassador, Liu Xioming, said the visit “offers the opportunity to shift the China-UK 'Golden Era' into a higher gear and upgrade bilateral relations” amid the UK’s “critical” Brexit negotiations.
Our founder and CEO, John Zai, also predicted that Theresa May's visit would focus on strengthening this ‘Golden Era’ of Sino-British relations: “I hope it will signify the UK’s continued interested in global and particularly China-UK trade post Brexit. I believe the UK’s wealth of ideas and innovations will be in high demand during the realisation of the Belt & Road Initiative projects”
John Zai continued:
“China has invested in the UK continuously. I do believe the Brexit vote has resulted in an initial shift of investment and there will be many changes in the coming years. However, the UK continues to be a very attractive destination for Chinese investors and business delegates.”
Though brief, Liu Xioming said Theresa May’s visit was “a complete success”. Chinese State media reported that the Prime Minister was warmly received, and even nicknamed her “Aunty May”.
More importantly, a number of exciting partnerships between the UK and China were announced during Theresa May’s visit.
On arrival to China, the Prime Minister revealed a new education deal between the two countries. The deal includes the extension of a teacher exchange programme, joint training of pre-school staff in the UK and China, and further education deals worth more than £550m, which it is claimed will create 800 jobs in the UK.
Theresa May also announced a further £300 million of deals to forge cultural links between the UK and China. The biggest development was a new agreement between the Department for Digital, Culture, Media and Sport and China's State Administration of Cultural Heritage for a three-year programme of activity to develop cultural heritage co-operation. The agreement also included plans to air ITV shows Poldark and Mr Selfridge on Chinese TV, as well as the creation of an ‘Eden project’ near Tianjin.
Among Theresa May’s trade delegation were a number of representatives from car firms, including Dr Andy Palmer, president and CEO of Aston Martin. During the trip, Palmer announced that Aston Martin plans to invest £600 million in China over the next five years.
The trip also provided news of Chinese investment for the UK. China’s largest e-commerce retailer, JD.com, revealed its plans to invest £2 billion in importing British goods into China.
As well as these big announcements, Theresa May also spent time with China’s president Xi Jinping to discuss the ongoing relationship between the countries. Downing Street representatives insisted “there was no specific discussion of a particular model for a trade deal between the two countries after Brexit” during the meeting. However, the BBC reports that Theresa May feels confident “we will be free to strike our own trade deals" after leaving the EU.
As an organisation with strong links to both the UK and China, we are always pleased to see the two countries working together. Each country has its own idiosyncrasies when it comes to doing business, and there is a lot that Chinese and British firms could learn from each other.
According to John Zai, there are a number of challenges that UK businesses need to overcome in order to trade successfully in China:
“UK businesses looking to successfully trade with China require local connections and an understanding of the Chinese business culture. Obstacles such as the ‘Great Firewall of China’, which block many Western applications need to be considered as well. Identifying the right partners is key, as personal relationships exert great influence, and at Cocoon Networks we support businesses in forging these local connections”.
However, John Zai continues: “The UK’s strengths are its service sector and its soft power, especially education, R&D and artistic endeavours. And of course technological innovation. Chinese businesses can greatly benefit from the UK’s expertise in these areas”.
We think cross-cultural collaboration can be beneficial for both parties - especially within the tech industry. We look forward to seeing how the UK and China can continue to strengthen their relationship in 2018 and beyond.