Opinion | Brexit: Britain can capitalise on opportunities to expand economic ties with China

A few weeks ago the British Chancellor of the Exchequer Philip Hammond visited China and Hong Kong, demonstrating the continued importance of the region just weeks after his appointment by new Prime Minister Theresa May. As the former foreign secretary, he is no stranger to engagement with China and that continuity will be welcome.

It was timely that the G20 met in Chengdu and that the chancellor extended his trip to Hong Kong. The UK wants to build on its relationship with China, which has strengthened significantly in recent years, and establish post-Brexit dialogue as it already has with other leading trading partners such as Australia and India.

The Brexit story will take longer to play out but it is critical to have these conversations under way, and they will form the basis of the legal framework for trade and investment in the years to come. We do not foresee investment outbound from China to the UK – in areas such as infrastructure and energy – slowing down, but the UK must reflect deeply on how Brexit affects its major trading partners and ensure there is no damage to these relationships.

Indeed, legal shifts resulting from Brexit may actually create additional opportunities for Chinese investors. For instance, the final negotiation process may result in changes to European Union procurement law, which currently causes packages of investment to be individualised rather than wrapped.

If the UK moves away from these rules it will have greater flexibility to structure deals that will appeal to Chinese investors, who often like to combine construction and co-financing, for instance. Greater control over procurement rules may make the UK a more attractive investment proposition.