Editorial | UK-China talks offer cautious grounds for optimism on relations

The change of government in Britain last year raised hopes of a reset for the country’s strained relations with China. Since then, the UK has stepped up engagement and made it clear that strengthening economic ties is the priority. The new, more constructive, approach is encouraging. Finance minister Rachel Reeves recently visited China, describing her trip as a “significant milestone in relations”. Reeves co-hosted the China-UK Economic and Financial Dialogue with Vice-Premier He Lifeng. This important platform lapsed for six years amid the pandemic and tensions between the two countries, especially over Hong Kong. The revival of the talks is a positive step.

He said extensive interests shared by Britain and China outweighed their differences and spoke of the “vast potential” for collaboration. Reeves hailed agreements which she said could boost Britain’s economy by a billion pounds. The British government will, however, face challenges. The visit was seen as controversial in the UK. It coincided with market turbulence and the cost of British government borrowing soared to the highest level in many years.

There were calls for Reeves to return from China to tackle the crisis. Concerns were also raised about the implications of stronger economic ties, especially in green energy, with suggestions the UK would become vulnerable to Beijing. But as Reeves said, engagement with China is in Britain’s interests, as it strives to kick-start a flagging post-Brexit economy. The Labour government is desperately seeking growth and it needs the trade and investment China can provide.

Closer ties will benefit Beijing, too, amid efforts to stabilise foreign trade and attract overseas investment, with uncertainties over the return of Donald Trump to the White House.

Many significant sticking points remain, especially over Hong Kong. The UK’s six-monthly report on the city is regularly rebutted by the Hong Kong administration and Beijing. The previous Conservative government was highly critical of the city’s national security laws, with several British judges quitting the city’s top court.

But Hong Kong, with its historic links to Britain and role as China’s superconnector, has a key part to play in improving the relationship. Vice-Premier He said the city could be a bridge for closer cooperation, but stressed both sides must respect each other. Reeves spoke of the need for frank and open discussions on “areas where we disagree” while hailing a new era in respectful and consistent relations.