UK, Chinese Firms Close Multi-Billion Trade Deals

The UK and Chinese firms have signed £14 billion (circa USD 23.7 billion) of trade and investment deals as the Chinese Premier Li Keqiang meets the UK Prime Minister David Cameron during a visit to the UK.

The annual UK-China summit takes place just 6 months after the UK Prime Minister’s visit to China and with bilateral trade at record levels – up by 8% overall in 2013. UK exports to China have more than doubled since 2009, and are growing faster than the country’s French and German competitors. Last year UK exports to China averaged more than £1 billion each month.

The UK benefited from Chinese investments worth over £8 billion in 2013/14 alone, creating or safeguarding over 6,000 jobs in the UK.

Trade and investment deals announced during the UK-China summit include:

• BP and the China National Offshore Oil Company (CNOOC) signed an agreement worth £12 billion on the supply of liquefied natural gas. The deal will see BP supply CNOOC with 1.5 million tonnes of gas per year over the next 20 years, starting in 2019.

• China Minsheng Investment Corporation (CMI), China’s largest private sector investment group – with capital of $8 billion – announced yesterday that it will open its European HQ in London with an investment of around £1.5 billion. Investments will cover a range of sectors including financial services, advanced technology, offshore engineering, new energy, and environmental protection.

• MAP Environmental Ltd and Z N Shine Solar entered into a joint venture to purchase, develop, construct and manage £400 million of UK solar PV assets. The project will involve a 3 year construction programme in conjunction with some of the UK’s largest engineering, procurement and construction contractors and the on-going maintenance will run for up to a further 20 years. The project will generate up to 50 new UK jobs in design, administration and operation roles with a further 500 new UK jobs in construction and maintenance created over the period of the contract.

• China Merchant Securities (CMS), China’s third largest securities firm in terms of net capital, opened its first London office which has been authorised by the Financial Conduct Authority yesterday, creating at least 40 new UK jobs in its initial stage. CMS will increase the volume of commodity trading in London and play a significant part in the internationalisation of the Chinese currency Renminbi (RMB), reinforcing London’s position as the second largest offshore RMB trading centre, followed by numerous others.

Speaking at the press conference for the UK-China summit yesterday, Prime Minister David Cameron said:

“This government is committed to implementing our long-term economic plan and to turning our country around. We are starting to see that plan bear fruit. I’ve always said that a key part of that plan is linking this country up to the fastest growing economies on the planet and China is central to that.

In the last few years we have made a huge difference and built a much stronger bilateral trading relationship between our countries. The figures tell the story – bilateral trade at record levels, our exports to China up 15% in 2013, they have more than doubled in the last 5 years and at £1 billion a month, they are growing faster than France or Germany.”

UK Business Secretary Vince Cable said:

“There has been more investment into the UK from China in the last 18 months than in the previous 30 years. Our country’s brand is recognised around the world and the Chinese have an appetite for high quality British goods and services.

I led a business delegation of ambitious UK companies to China just a few weeks ago, opening doors for British business and helping to lay the groundwork for deals to be signed today.”