UK and China optimistic of post-Brexit trade deal

The UK and China have taken the first tentative steps towards negotiating a free trade deal once Britain has completed its exit from the European Union.

UK-China trade deal
Crucially, such an agreement could open up the Chinese market to the UK's all-important services sector, particularly the banking and insurance industries. There would be concerns, though, that in return the UK could be flooded with cheap Chinese imports, undercutting indigenous industries.The Chinese Ministry of Commerce has already expressed its willingness to do a post-Brexit deal with the UK, and Chancellor of the Exchequer Philip Hammond, speaking to the BBC at the meeting of G20 finance ministers in Chengdu, said that he could "definitely" see a trade deal with Beijing becoming a reality."We already have a strategic partnership with China," Mr Hammond said. "We have hugely increased our trade with China, investment both by British companies into China and by Chinese entities into the UK.
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"That's about as far as we can go while we are members of the European Union. But once we are out of the European Union, then I have no doubt on both sides we will want to cement that relationship into a firmer structure in a bilateral way that's appropriate. That's something we will have to explore in the future."Mr Hammond said that, in the wake of the referendum vote on EU membership last month, the UK had to explore "new opportunities" across the world. "What we now need to do is get on with [Brexit] in a way that minimises the economic impact on the UK economy in the short term and maximises the benefit in the long term," he said.The Chancellor admitted there had been "global disappointment" at the outcome of the referendum – a sentiment echoed by the G20 ministers, who said at the end of their meeting that the result of the vote had heightened risks to the future growth of the global economy.In their final communiqué, the ministers urged the UK and the EU to remain close partners. "The reality is there will be a measure of uncertainty continuing right up to the conclusion of our negotiations with the EU," Mr Hammond admitted.US Treasury Secretary Jacob Lew stressed “the need for negotiations to take place in a smooth, pragmatic and transparent manner”. He added, “A highly integrated relationship between the UK and the EU is in the best interests of Europe, the United States and the global economy."The G20 cited a slowdown in the Chinese economy, the failed coup in Turkey, and “geopolitical conflicts, terrorism and refugee flows” as among other factors complicating the global economic environment.The communiqué added, "The global economic environment is challenging, and downside risks persist, highlighted by fluctuating commodity prices, and low inflation in many economies."G20 members reaffirmed their determination to use all policy tools – monetary, fiscal and structural – to achieve strong and sustainable growth.Speaking to reporters, Chinese Minister of Finance Lou Jiwei said structural reforms had been high on agenda. "The G20 member countries have located the highest common divisor in terms of the important fields and principles of the reforms and identified the priorities and guiding principles of the reforms," he said."This will help G20 member countries to collectively promote and enforce structural reforms and to maximise the positive spillover effects of the reforms."In the communiqué, the G20 underscored "the role of open trade policies and a strong and secure global trading system in promoting inclusive global economic growth,” and said it would “make further efforts to revitalise global trade and lift investment".But the group also conceded that "the benefits of growth need to be shared more broadly within and among countries to promote inclusiveness".Chinese interest in buying UK property has surged since June's referendum, the website juwai.com, which offers overseas properties to Chinese investors, said on Monday. The fall in sterling's value since the vote had resulted in a rise of between 30 and 40 per cent in enquiries between 20 June and 11 July, the website reported.“With politics stabilising and a competent new government in place, the UK looks like the same haven as ever – but cheaper,” said Bernie Morris, UK, Europe and Middle East president of juwai.com

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