Li's Britain journey 'to help build trust'

Business delegation to accompany premier; billions in deals likely

Deals worth more than $30 billion are likely to be signed during Premier Li Keqiang's visit to Britain this week, highlighting growing ties between the two nations.  [Special coverage]

"More than 40 agreements are expected between the governments and businesses covering a wide variety of sectors including energy, investment, cultural and educational cooperation," said Liu Xiaoming, China's ambassador to the UK.

Two hundred-plus Chinese business leaders will join the delegation.

Infrastructure, high-speed rail, nuclear and finance deals, as well as London's role as an offshore yuan trading hub, will be key topics during the visit.

Li, who leaves Beijing on Monday, will meet Queen Elizabeth II and have five hours of talks with British Prime Minister David Cameron. Li and his wife will also meet on a personal level with Cameron and his wife.

Li will witness the signing of agreements and attend the China-UK Global Economic Round-Table.

"I believe all these arrangements will help build trust and consolidate close working and personal relations at the highest level," Liu said.

Li will give a speech to top British think tanks and address a business gala and the China-UK Financial Forum.

Britain is China's second-largest trading partner in the European Union and a major destination for China's overseas investment.

Two-way trade hit $70 billion last year. Chinese investment in the UK has made huge progress. In the past two years, Chinese companies invested over $13 billion in the UK, outdoing their total UK investment of the previous three decades.

China-UK relations became strained in 2012 after Cameron met with the Dalai Lama, but they warmed after the British prime minister visited China late last year to scout for investment to boost the cash-strapped British economy.

The tensions flared again in April when China was listed as "a country of concern" in a "so-called human rights report" by the British Foreign Office.

"We think this report was biased against China," Liu said. It "missed the big picture. ... I don't think pointing fingers is a good way to enhance mutual understanding.

"Before I came here, we used to say when we talked about Europe it's Britain, France and Germany," Liu said.

"But, unfortunately, many opportunities were missed in the past year or so, so now it has become Germany, France and Britain."

Britain's visa reforms are also to be announced on Monday to encourage investors and other visitors from China. Liu said, "I receive complaints from businesses here. They have difficulties (rotating) their senior executives because of visa restrictions."

"I think visa issues really erode British power to attract more foreign businesses, talented people," Liu said.

More than 1 million visits are made each year between the UK and China. About 130,000 Chinese students attend school in the UK, making them the largest overseas student community in Britain.

"Both countries have a good shared history and know each other well, and I think that the status of the UK in China is good," said Kerry Brown, professor of Chinese politics and director of the China Studies Centre at the University of Sydney in Australia.

Brown was previously head of the Asia program at the Chatham House think tank in London.

Shi Yinhong, a professor of international studies at Renmin University of China in Beijing, said, "The foundation of China-UK relations is good." Mutual respect and attention to each other's major concerns are the basis for maintaining political trust and developing bilateral relations, he said.

"The two countries can develop stable, win-win relations if the UK does not touch China's sensitive issues and core interests like sovereignty and territorial issues," he said.

Brown said the areas in which China and the UK now cooperate are in the UK finance market and the educational sector.

"Creative industries will be more important and the UK can be a technological partner. So I think the UK will be able to promote itself as an important global player to China," Brown said.

The UK is a great supporter of the Chinese free trade zone policy. Our prime minister and the chancellor of the exchequer recently appointed me to be the chairman of the International Experts Consultation Group that has been set up to help Chinese policymakers develop the FTZ policy.

We have so far assembled a group of around 50 international firms ready to lend their expertise to help China develop practical solutions to their policy requirements. The plan is initially to produce a series of short policy papers, each focusing on a specific topic, which will then be widely disseminated among Chinese policymakers, to be followed up by a whole series of face-to-face dialogues.

Gerry Grimstone, chairman of TheCityUK

The business community as a whole is expecting great participation in Li's visit. And we have seen tremendous interest by UK companies in his visit. I think this is in fact against the context of a strongly growing trade and investment relationship in both directions.

UK exports to China are growing well and we have seen the surge of Chinese investments in the UK, and I think the business community is hoping that Li's visit will serve or act as an impetus to the trade and the investment relationship.

Stephen Phillips, CEO of China-Britain Business Council

I hope Premier Li's European visit would encourage the UK government to change the visa system to make it easier for Chinese people to visit the UK for tourism reasons and business reasons. I think the fact the visit is taking place is very significant. Hopefully it will be the start of many more trade visits between the two countries.

We think the visa process is too complex, takes too long and is too expensive. We are pleased to see that they've made some changes to it. And we are encouraging them to make it easier, to streamline the process, so that people can apply for visas without having to submit so much documentation or fill in so many forms, to have more centers where they can submit their applications.

Willie Walsh, CEO of British Airways

Premier Li Keqiang's visit comes at a very exciting time for business relations between our two countries. The city and London Stock Exchange have, for the whole of their long history, been natural partners to ambitious, fast-growing emerging markets.

We are well placed from an institutional, regulatory and structural position, and our proud internationalism, to work with partners from across Greater China to support the exceptionally exciting opportunity that the region presents to the world.

Alexander Justham, CEO of London Stock Exchange Plc

As trade and investment grows between the UK and China, the Chinese financial sector is expected to expand into London. The Chinese banks are huge in China and tiny everywhere else, but we expect far more China investment and trade in the UK and that means more China activities in the banks. We've got Chinese insurance companies beginning to be more active in the UK, and also Chinese law firms.

Mark Boleat, policy chairman of City of London Corp

http://www.ecns.cn/2014/06-16/119110.shtml