Table of Contents
Analysis of the Existing Relationship
China is one of the countries with strong relations with the United Kingdom. Ambassadorial and trade ties have been in existence for over four decades. Since the start of this bilateral relationship, various projects, partnerships, and cooperation have taken place and grown in strength overtime. To stress the importance of China-UK ties, the two governments organized a visit to discuss issues related to trade, security and human rights. Chinese President, Xi Jinping paid a state visit to former Prime Minister David Cameron. The visit was aimed at discussing how the Sino-UK relationship can be strengthened. This brief provides you with an essential background information ahead of the upcoming follow up trip to China.
The Sino-UK relationship has been successful and beneficial to both countries. The success of the relationship is mainly attributed to personal ties and a healthy mutual understanding. The number of dialogues that have taken place between the two countries is more than with any other European country. The dialogues have not only been organized to discuss trade but also other important relations which include but not limited to international strategy, social ties, cultural links, politics and education. Other sectors discussed by delegates in the UK-China Economic and Financial Dialogue (EFD) are infrastructure, energy, health and financial services. China has a huge importance and impact in the economy of UK. This is proven by the fact that China is currently second, only behind US, as a non-European Union import partner. The imports have grown steadily over the years from 3.3% in 2004 to 7% in 2014 (ONS 2015, par.3). The value of imports from China has grown from £11.3 to £37.7 billion over the same period. Apart from the imports, UK also exports goods and services to China. The Chinese market accounted for about about 3.6% of total exports by 2015 while 2.8% of UK’s foreign investments are in China (ONS 2015, par.6). This makes China the sixth largest market for UK’s exports. Despite fewer investments by China in the UK, the businesses are still noteworthy UK. According to Outward Foreign Affiliate Statistics (OFATS), which measures revenues and employment of foreign-based UK businesses, it is estimated that UK businesses in China collectively generate a turnover of about £13.4 billion. Other than a market for exports, the UK has also benefited from relatively lower priced goods from China. The relationship is compatible and healthy to UK’s economy since China mainly concentrates on labor-intensive manufacturing while UK shifts to value and high skill industries. From the trade transactions between the two countries, it is clear that China is a huge contributor to the economic growth of UK.
The Sino-UK trade relationship is of a balanced nature. The relationship is such that they both remain competitive but most importantly produce goods and services aligned to the needs of the other. This complimentary nature of the ties ensures that both countries are able to get the products they do not have while at the same time the demand for their own rises in the other country. This not only fosters a healthy trade relationship but also promotes fair financial and trade dependence between the two countries. Some of the key trade sectors in the UK- China relationship are energy, agriculture, machinery and electrical equipment. Other important sectors of trade are motor industry, footwear and medical apparatus. China has invested in UK even after the uncertainties brought about by Brexit. Investments by Chinese companies come in form of hotels, clubs, cinemas and real estates. Specific examples of these are Travelodge Royal Scot Hotel, CIMC Group, Leyou Technologies, Wanda Development and Sichuan Godong Construction (Tian 2016, p.7). UK is the eighth largest destination of Chinese investments and contracts. Chinese investments in UK range from energy, food, metals, technology and finance. Apart from fully owned Chinese firms, China has also invested in UK companies such as Barclays, BP, Weetabix and Pizza Express. People to people links have taken place between China and UK resulting into improved insight, understanding and influence. Several exchanges have taken place in education with many British students studying in China. The number of Chinese students in UK has steadily risen through initiative such as Chevening Scholarships in institutions such as Imperial and Cranfield colleges (Brown 2016, p.23). Exchanges have also taken place in cultural and social aspects through various delegations and tourism. Despite the healthy Sino-UK relationship, there are various challenges that face and undermine the tie. One of the problems is low prices of Chinese manufactured goods such as electronics and clothes leading to stiff competition of market share. Rapid growth of Chinese economy has also led to increased prices of raw materials due to high demand. It has also led to decline in manufacturing industries because the UK companies cannot compete favorably with Chinese ones that receive large amounts of subsidies from the government. This in turn causes deficit in trade balance account between UK and China. Economic and political differences have also affected the relationship between the two countries. A factor such as Brexit has affected trade ties, though, minimally while previous engagement of the Great Britain in colonialism complicated the relationship and the clash of diplomatic views has never ended.
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Chinese Military Build-Up and Assertiveness
In the early 1970, the Chinese community party (CCP) launched a strategic plan of establishing state sponsored capitalist economy system for purposes of spreading its influence on other parts of the world. Realization of this economic goal, which would rely heavily on international trade undoubtedly called for investment and modernization of the country’s military. Historically, Chinese’s military has suffered from losses and decline in cold war era and the conflicts of Vietnam War. Additionally, the territorial disputes between China and south East Asia countries such as the Philippines, South Korea, Malaysia and Vietnam has made the administration to refocus on militarization of the region. Such element of suspicion among the countries in the south East Asia was a determining factor of diplomatic engagements (Gerstl and Strašáková, 2016, p. 13). Additionally, China being a major industrial economy, which highly rely on manufacturing and export trade needs to secure sea trade routes. This will ensure the industries have access to uninterrupted supply of much needed raw materials and energy. Therefore, Military buildup would be important in achieving these goals. On the contrary, the USA pivot policy which was conceived in 2011 in a bid to undertake redeployment and increase of military bases in the south east Asia for supporting the allies Japan and South Korea against unrelenting Chinese also has led to military build-up. The pivot policy to counter China economic dominance in the Pacific Asia region has led to heightened readiness to counter the threat through militarization tendencies. On the economic front, attempts by USA to establish the Trans-Pacific Partnership agreement with China neighbors has been perceived by the authorities as a step to isolate China from the potential trade partners. These ideally weaken China trade prospects negatively affect the export trade, which would in turn lead to decline in domestic manufacturing. The U.K being traditional allies of USA and former colonial power in South East Asia would have some advantage in presenting diplomatic approach to encourage responsible and civilized based military build effort by China. For example, effort should be made at fighting global terrorism, which has no geographical boundaries and pose threat to security and regional economic stability. Another problem of concern is the disputes in the South China seas where the Philippines and Vietnam see China as an aggressor out to claim part of their territorial integrity. Such disputes should be addressed through the stipulations of the international law, which offer conclusive guidelines on countries territorial integrity. For example, international law on the right of every nation to use international waters without causing harm should be upheld in such engagements. Therefore, making China officials understand the importance of civilized militarization and responsible diplomacy would be of help in addressing incidences of military buildup for containing unrealistic threats.
Potential threats from China to Taiwan and Implication to the U.K
The Cross-Strait bilateral relationship has been strained by undue influence of China on the Domestic affairs of the Taiwan. China has always engaged in psychological warfare against the Taiwan government in the main land. For example, there are notable instances where China has been fighting and making efforts to derail the democratic system of government in Taiwan. Incidences of civil protest and demonstration have been common especially between political parties supporting independence of Taiwan and those that prefer unification. The political and ideological contestation created and inspired by China is a threat to political stability of Taiwan (Hudson 2014, p.60). The U. K, which supports democratic governance and the right to political freedom will have difficulty in the bilateral relationship with China. Moreover, this is likely to affect the foreign policy position of U.K, for example, whether it would support Taiwan international diplomatic effort to seek independence from China through members of the United Nations. Additionally, the U.K would be faced with the difficulty of handling the ‘One China policy ‘doctrine which the government has used in chatting most of the diplomatic path interest. Economically, Taiwanese companies and investments face immeasurable negative effects in the mainland China. For example, Chinese authorities would undertake nationalization of Taiwan linked companies leading to foreign income earning blow, which is essential for economic growth. Freezing of financial assets of individual investors from Taiwan who sympathize with movements and supporting independence from mainland China would cripple economic progress and growth of Taiwan. Such actions would have serious implications to the U.K economy since Taiwan accounts for the largest foreign direct investment of destination in Europe (Damm and Lim, 2012, p. 179). The bilateral trade in the defense and processed food export would be affected leading to reduced growth in the U.K economy.
Protection and provision of human rights
Chinese authority has been implementing censorship and tight control of internet access for the population. The ruling communist party perceives freedom and unregulated internet to be a threat to the ideological establishment of ruling authority. Notably, foreign internet and social networking service providers such Google face strict business-operating environment while other multinationals such as Facebook have been completely banned. Restricting right to online freedom and information access is violation of human rights. Ideally, the authorities should instead be advised to consider creating education and public awareness on responsible use of online platforms rather than the ill-informed punitive measures.
Initiatives and efforts of political activism and civil rights movement is one of the contributing factors to democratization of governance in most countries in the West. Within China are outlawed authorities, which have resulted in diplomatic row with USA and allies, which ascribe to supporting civil right movement. Arguably, Chinese government has been on the defensive with claim that such intervention by other countries is itself interference with domestic issue, which contravenes the right to sovereignty. Therefore, this require clarity in understanding the limits of the law, which should be used in enhancing human dignity which would be appropriate for government to reevaluate in a bid to embrace tolerance to different political opinions (Ming, 2011, p. 288). Regarding the press freedom, the government should be able to understand striking of balance between control and transparency. For example, transparency is an essential aspect for fighting and prevention of vices such as corruption. Additionally, understanding the level of cooperation between the state power and social power will be of great help in introducing necessary reforms.
In consideration of the relationship that the UK enjoys with China, the latter should be considered as an opportunity and ally instead of a threat. This is because the benefits UK accrues from the trade ties outweigh the challenges. Furthermore, the ties have been strengthened by several business delegations held between stakeholders of the two nations. According to China’s Minister for Asia and Pacific, Alok Sharma, mutual benefits has resulted from the relationship with UK being one of the top destinations favored by Chinese investors while at the same time serving as a market to UK’s products (Sharma 2017, par 6). Therefore, the Sino-UK ties should be embraced and fostered. This can be done through policies such as reducing trade barriers and addressing the quota and license system. These help in reducing start up procedure and administrative bottlenecks for UK’s business in China.
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- Damm, J., & Lim, P 2012, European perspectives on Taiwan. Wiesbaden, Springer VS.
- Ming, W 2011, Emerging civil society in China, 1978-2008. Leiden, Brill.
- Tang, L 2017, China’s Authoritarian Path to Development Is Democratization Possible. Florence, Taylor and Francis.
- Gerstl, Alfred & Strašáková, Mária 2016, Unresolved border, land, and maritime disputes in Southeast Asia: bi- and. Brill
- Tian, D 2016, Eight Major Chinese Investments in UK Since Brexit. Beijing. Web.
- Office for National Statistics (ONS) 2015, How Important is China to the UK Economy?. ONS Digital
- Brown, K 2016, Erase and Rewind: Britain’s Relations with China. Sydney, Australia-China Relations Institute (ACRI).
- Sharma, A 2017, UK-China Relations are Going from Strength to Strength as we Celebrate 45th Anniversary. London.
- Hudson, C 2014, The China handbook. London: Routledge.