China politics: Quick View - Theresa May refuses to back the BRI formally
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- Economist Intelligence Unit
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- International Relations, Politics, News Analysis, Forecast
- Political Geography
On February 2nd the UK prime minister, Theresa May, concluded a three-day state visit to China.
Mrs May's visit comes at an awkward time for the prime minister, who faces a challenging domestic political situation in navigating the UK's exit from the EU. Her visit was designed partly to assuage Chinese concerns that Brexit could derail the "golden age" in UK-China relations established by her predecessor, David Cameron, particularly after Mrs May hesitated in approving a new Chinese-backed nuclear power station at Hinkley Point in August 2016.
Like the visits recently made by her US and French counterparts, Mrs May signed a number of commercial agreements during the course of her trip, reportedly worth £9bn (US$11.7bn) in total. Medopad, a UK health start-up, signed more than £100m (US$140m) worth of deals with a number of Chinese companies in the internet, insurance and education sectors. Mrs May further announced a £550m education deal, which is expected to create 800 jobs in the UK. Significantly, the two sides also signed an agreement to lift China's 20-year ban on British beef imports within six months, echoing similar deals made with France and the US.
Neither side, however, was able to make significant progress on the larger political issues. Despite the fact that Standard Chartered, a British bank, announced a five-year project financing deal worth Rmb10bn (US$1.5bn) related to China's Belt and Road Initiative (BRI), Mrs May declined to sign a memorandum formalising the UK's backing of the framework. The British side cited concerns with international standards, protection of intellectual property and project bidding transparency associated with the BRI. Her reticence mirrored similar hardening attitudes towards Chinese overseas investment from both elsewhere in the EU and in the US. Meanwhile, although both sides agreed on a broad trade and investment review, China was unwilling to provide the UK with a concrete bilateral trade framework, citing the need for the UK to complete Brexit negotiations first before moving ahead with any agreement.
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