On Tuesday, the Chinese Premier, Li Keqiang (far left) gave a press conference with David Cameron at the Foreign Office. Crowds of Chinese officials and delegates mixed with British diplomats and business leaders in a set of the FCO’s most glorious rooms, the garish wallpaper shining approvingly down on the melee.
The press conference itself took place in one of the larger rooms, and Chinese security men inspected the television crew’s video equipment—one particular microphone was causing special interest and a small crowd gathered to scrutinise it. The Chinese Ambassador, flanked by his substantial press team, moved into the room and set up camp in the front rows of the Chinese side of the auditorium. At the far end of the room stood the flags, the Chinese and British intermingled, and before these, two podiums. At each side of the dias lurked a huge Chinese security guard, each with a crew cut, shoulders the breadth of a barn door, and carrying what looked like a large lap-top case. A closer inspection revealed these to be fold-out bullet-proof shields. These were the men who would throw themselves in front of the Chinese premiere in the event of an assassination attempt. By each of these two heroes of the Republic stood a British counterpart, one of whom was chewing gum.
Then came the two leaders. David Cameron spoke first and did so in the warmest terms. He called the rise of China the “defining” event of our age, and announced with pleasure that, in the course of Premiere Li's visit, the British government had signed £14bn worth of agreements with China. Li echoed this friendly sentiment, saying through an interpreter that “today is a joyful day,” and stressing the importance to China of its relations with the UK. The two nations “share substantial common interests,” he said, many of them of “global significance.” He welcomed the recent relaxation of the visa application system for Chinese students entering Britain, saying he hoped that the young could act as a “bridge” between the two countries.
Among these platitudes were moments of substantial political significance. “China supports the EU integration process,” said Li. Take that, Nigel Farage. He then went on to say that the Chinese authorities “welcome a strong, prosperous and united United Kingdom.” Take that Alex Salmond. Cameron also fielded a question about the Presidency of the European Commission. Jean-Claude Junker is emerging as the consensus candidate, and the preferred pick of Angela Merkel, the German Chancellor. Cameron, his tone exasperated, said that he would oppose Junker’s appointment “right up to the end,” a line that felt like the protest of a defeated man.
But the real business of Li’s visit was in the deals struck between Britain and China. For all its chumminess, the guts of the Anglo-Chinese relationship consist of a straight-forward matching of economic needs. Britain is a deficit nation. The total debt pile is now £1.2 trillion. But in 2013, China had a current account surplus of $242.7bn. Britain needs to spend large amounts on infrastructure, and China is looking for big projects in which to invest. China needs to stay abreast of technological and industrial innovations, and Britain can offer these, at a price. China wants to open itself up to global financial markets and the City of London is in the best time-zone to act as a conduit for Renminbi-denominated deals. A Treasury statement this morning said that: “The Chancellor has today welcomed the People’s Bank of China’s appointment of China Construction Bank (CCB) in London as the first clearing bank outside Asia for the Chinese currency, the renminbi (RMB).” “This appointment," the release continued, "further strengthens London’s position as a centre of RMB trading and is part of the government’s long-term economic plan to establish Britain as the western hub of Chinese finance, with two thirds of all RMB payments outside of China and Hong Kong now taking place in London.”
The list of deals completed during the visit was startling. BP and the Chinese National Offshore Oil Corporation (CNOOC) have reached an agreement—details unspecified. There will also be: cooperation on infrastructure financing between Lloyds Bank and China Development Bank; a global strategic alliance agreement and short-term liquid natural gas supply contract between Shell and CNOOC; and a deal on nuclear cooperation with the Chinese National Energy Administration.
And on it went. There will be “a framework agreement on nuclear fuel cycle supply chain collaboration" between the Chinese Atomic Energy Authority, Chinese National Nuclear Corporation and the Department for Energy and Climate Change. The University of Oxford is also doing its bit, cutting a deal with the China Scholarship Council. For those opposed to HS2, a shiver of alarm must have gone down the spine on hearing that a memorandum of understanding had been signed “between the NDRC [China’s National Development and Reform Commission] and DfT [over] business cooperation in the rail sector.”
On the face of it, such agreements should be welcomed. Much better to be an open economy than a closed one—but when it comes to China, how open should Britain be? Spokespeople from No10 are clear that the Prime Minister sees nothing wrong with Chinese investment in the most sensitive parts of Britain’s industrial base: from atomic energy to hi-tech manufacturing. It is not clear that the Prime Minister discussed with Premiere Li the issue of China’s almost complete disregard for international Intellectual Property law.
China presents immense opportunities for Britain—but the Prime Minister must remain alert to the aggression with which Beijing pursues its interests. Back in May, the United States brought charges against five Chinese hackers who, it claimed, were stealing economically sensitive secrets from America’s nuclear power, metals, and solar products industries. The US Attorney General Eric Holder made clear that, in the US’s view, the activities were state-sanctioned, saying that: “This is a case alleging economic espionage by members of the Chinese military and represents the first-ever charges against a state actor for this type of hacking.”
After the press conference, No10 told British reporters that there had been an exchange of gifts between leaders. Cameron gave Li three items: a £10 silver coin, celebrating the lunar new year; a boxed set of DVDs of Charles Dickens adaptations; and a signed copy of the first filming script of Downton Abbey. But what had the Chinese Premiere given Cameron in return? That information was not available. It seemed fitting. Britain has opened up to China—but it is not certain what it shall receive in return.
The press conference itself took place in one of the larger rooms, and Chinese security men inspected the television crew’s video equipment—one particular microphone was causing special interest and a small crowd gathered to scrutinise it. The Chinese Ambassador, flanked by his substantial press team, moved into the room and set up camp in the front rows of the Chinese side of the auditorium. At the far end of the room stood the flags, the Chinese and British intermingled, and before these, two podiums. At each side of the dias lurked a huge Chinese security guard, each with a crew cut, shoulders the breadth of a barn door, and carrying what looked like a large lap-top case. A closer inspection revealed these to be fold-out bullet-proof shields. These were the men who would throw themselves in front of the Chinese premiere in the event of an assassination attempt. By each of these two heroes of the Republic stood a British counterpart, one of whom was chewing gum.
Then came the two leaders. David Cameron spoke first and did so in the warmest terms. He called the rise of China the “defining” event of our age, and announced with pleasure that, in the course of Premiere Li's visit, the British government had signed £14bn worth of agreements with China. Li echoed this friendly sentiment, saying through an interpreter that “today is a joyful day,” and stressing the importance to China of its relations with the UK. The two nations “share substantial common interests,” he said, many of them of “global significance.” He welcomed the recent relaxation of the visa application system for Chinese students entering Britain, saying he hoped that the young could act as a “bridge” between the two countries.
Among these platitudes were moments of substantial political significance. “China supports the EU integration process,” said Li. Take that, Nigel Farage. He then went on to say that the Chinese authorities “welcome a strong, prosperous and united United Kingdom.” Take that Alex Salmond. Cameron also fielded a question about the Presidency of the European Commission. Jean-Claude Junker is emerging as the consensus candidate, and the preferred pick of Angela Merkel, the German Chancellor. Cameron, his tone exasperated, said that he would oppose Junker’s appointment “right up to the end,” a line that felt like the protest of a defeated man.
But the real business of Li’s visit was in the deals struck between Britain and China. For all its chumminess, the guts of the Anglo-Chinese relationship consist of a straight-forward matching of economic needs. Britain is a deficit nation. The total debt pile is now £1.2 trillion. But in 2013, China had a current account surplus of $242.7bn. Britain needs to spend large amounts on infrastructure, and China is looking for big projects in which to invest. China needs to stay abreast of technological and industrial innovations, and Britain can offer these, at a price. China wants to open itself up to global financial markets and the City of London is in the best time-zone to act as a conduit for Renminbi-denominated deals. A Treasury statement this morning said that: “The Chancellor has today welcomed the People’s Bank of China’s appointment of China Construction Bank (CCB) in London as the first clearing bank outside Asia for the Chinese currency, the renminbi (RMB).” “This appointment," the release continued, "further strengthens London’s position as a centre of RMB trading and is part of the government’s long-term economic plan to establish Britain as the western hub of Chinese finance, with two thirds of all RMB payments outside of China and Hong Kong now taking place in London.”
The list of deals completed during the visit was startling. BP and the Chinese National Offshore Oil Corporation (CNOOC) have reached an agreement—details unspecified. There will also be: cooperation on infrastructure financing between Lloyds Bank and China Development Bank; a global strategic alliance agreement and short-term liquid natural gas supply contract between Shell and CNOOC; and a deal on nuclear cooperation with the Chinese National Energy Administration.
And on it went. There will be “a framework agreement on nuclear fuel cycle supply chain collaboration" between the Chinese Atomic Energy Authority, Chinese National Nuclear Corporation and the Department for Energy and Climate Change. The University of Oxford is also doing its bit, cutting a deal with the China Scholarship Council. For those opposed to HS2, a shiver of alarm must have gone down the spine on hearing that a memorandum of understanding had been signed “between the NDRC [China’s National Development and Reform Commission] and DfT [over] business cooperation in the rail sector.”
On the face of it, such agreements should be welcomed. Much better to be an open economy than a closed one—but when it comes to China, how open should Britain be? Spokespeople from No10 are clear that the Prime Minister sees nothing wrong with Chinese investment in the most sensitive parts of Britain’s industrial base: from atomic energy to hi-tech manufacturing. It is not clear that the Prime Minister discussed with Premiere Li the issue of China’s almost complete disregard for international Intellectual Property law.
China presents immense opportunities for Britain—but the Prime Minister must remain alert to the aggression with which Beijing pursues its interests. Back in May, the United States brought charges against five Chinese hackers who, it claimed, were stealing economically sensitive secrets from America’s nuclear power, metals, and solar products industries. The US Attorney General Eric Holder made clear that, in the US’s view, the activities were state-sanctioned, saying that: “This is a case alleging economic espionage by members of the Chinese military and represents the first-ever charges against a state actor for this type of hacking.”
After the press conference, No10 told British reporters that there had been an exchange of gifts between leaders. Cameron gave Li three items: a £10 silver coin, celebrating the lunar new year; a boxed set of DVDs of Charles Dickens adaptations; and a signed copy of the first filming script of Downton Abbey. But what had the Chinese Premiere given Cameron in return? That information was not available. It seemed fitting. Britain has opened up to China—but it is not certain what it shall receive in return.
