UK steps up drive to boost trade ties with China

Chancellor of the Exchequer George Osborne has held talks with China's ambassador in London in the latest bid to boost trade ties with China in the wake of the Brexit vote in last month's referendum on European Union membership.

Exporting to and from China
Trade Minister Lord Price has already embarked on a mission to Hong Kong and Mr Osborne will head a trade delegation on a four-day trip to China later this month when he attends the G20 finance ministers' meeting in Chengdu.The talks in Downing Street with Ambassador Liu Xiaoming were described by an official as "productive discussions on investment, financial services, and fostering stronger trading ties" at which Mr Osborne restated his aim – first expressed last year – of creating a "golden era" in UK-China relations.Meanwhile, Business Secretary Sajid Javid has embarked on a round of post-Brexit trade talks on a visit to India and will also make a trip to China in the coming months. Trade missions to the US, Japan and South Korea are also being undertaken by trade ministers in the coming months.The need for the UK to establish new trading partners following the Brexit vote was highlighted by a report from the Organisation for Economic Co-operation and Development (OECD) on Friday, which suggested the referendum decision could result in a three per cent loss in GDP by 2020.Its report also said that a decline in foreign direct investment (FDI) could worsen the UK's already poor productivity and that the Brexit vote posed "a cloud" over the UK's strong performance on job creation since the financial crisis eight years ago.The threat to jobs was illustrated in a poll of 5,600 German companies by the German Chambers of Industry and Commerce which indicated that 24 per cent of those with operations in the UK were planning to cut jobs in Britain in response to the referendum outcome. Additionally, some 36 per cent of those with UK subsidiaries now planned to invest less in the country.Frances O'Grady, general secretary of the TUC, described the findings as "deeply worrying". She added, "Working people must not pay the price for Brexit with their jobs and livelihoods. The government urgently needs to come up with an action plan to reassure foreign investors and companies that Britain is still open for business."Now isn't the time for ministers to sit on their hands. They need to fast-track spending on key infrastructure projects like high-speed rail and the third runway at Heathrow."Meanwhile, a US investment mission to Northern Ireland this October, aimed at expanding American investment in the province's growth industries such as bio-medical sciences and cyber security, has been postponed partly as a result of the referendum result.Deputy First Minister Martin McGuinness said the postponement was indicative of a "considerable slowing up" of the prospects of Northern Ireland's being able to attract FDI following the Brexit vote."Plans were in place for an economic mission of considerable size for October of this year and that was on the basis they hoped the vote on Brexit would be a remain vote," he said. "Now, since that is not the case, I have been told that that visit has now been postponed, directly as a result of the vote. That is of considerable concern."A spokesman at the US consulate in Belfast said, "We are strongly committed to bolstering two-way trade and investment with Northern Ireland. We anticipate that a US trade and investment delegation will visit Northern Ireland in the first half of 2017."

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Read more about China and the Asia-Pacific region in our APAC Summer 2016 digital magazine.

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