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New Orientation
UK Draws Fire for Deepening Ties with China

Today sees a meeting between UK Prime Minister David Cameron and Chinese President Xi Jinping at Cameron’s country house, called Chequers. The meeting comes midway through Xi’s trip to the UK, which started this Tuesday and ends thus Friday, and the matters up for discussion include Syria and facing “extremism.”

But the most important part of Xi’s visit so far is the growing economic, not the military or diplomatic, cooperation between the two powers. The UK is allowing Beijing extensive access to its markets and inviting Chinese investments in British infrastructure, according to Bloomberg:

David Cameron said Chinese President Xi Jinping will bring more than 30 billion pounds ($46 billion) in deals and investment on his visit to Britain this week, as the prime minister defended himself against charges he was being too warm towards his visitor.

The deals will create 3,900 jobs in the U.K., in sectors including the creative industries, retail, energy, health and technology, financial services, aerospace and education, Cameron’s office said in an e-mailed statement, without giving further details.

The United States has not been hiding its displeasure at the United Kingdom’s warm reception of Chinese President Xi Jinping in London this week. From the standpoint of the U.S. and others, Britain is brashly dismissing concerns about human rights and undermining efforts to contain China’s rise.“If there is one truism in managing relations with a rising China, it is that if you give in to Chinese pressure, it will inevitably lead to more Chinese pressure”, warned a former advisor to President Obama.

It’s not necessarily an inaccurate criticism, but it’s worth putting it in some historical context: Waspophobes have long complained that the Brits are a bunch of heartless profiteers. Indeed, Britain gained access to China in part by exploiting the morally dubious opium trade, so there is an ironic appositeness to it overlooking China’s human rights record today.

Britain may well be getting itself into some trouble here; offer the Chinese an inch, and they’ll take the opportunity to seize a foot. Still, self-righteous world leaders shouldn’t simply criticize Cameron’s actions as naive or immoral. Opening Britain up to Chinese investors makes a lot of sense for the UK, particularly as London works to solidify its position as the financial capital of the world. Moreover, if the Brexit is a real possibility, Cameron is wise to line up some big non-European trading partners.

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  • Jim__L

    $46 billion in investment leads to only 3900 jobs?

    Wow, those jobs must pay well!

  • Andrew Allison

    Perhaps the former advisor should give his advice (which we know, of course, like all other advice will be ignored) to his former boss.

  • rheddles

    Obama has made his hatred for Britain clear. Payback’s a witch.

  • Jacksonian_Libertarian

    Japan did the same thing before they went into the now 26 years of destructive deflationary depression. The Brits are just taking the money fleeing China’s crashing economy, China’s political leaders have to have some place to stash their ill gotten gains before the little people come for their heads. China has a recent history of violent revolutions, and the Chinese leadership is well aware of this fact.

  • MyRightPenguin

    “Moreover, if the Brexit is a real possibility, Cameron is wise to line up some big non-European trading partners”

    Yeah, the problem with this is that Cameron will be going into the Brexit referendum campaigning to stay in the EU. If you doubt this read up on “purdah” and how he was recently defeated in the UK parliament after he was caught trying to rig the game to remain in the EU.

  • Greg Olsen

    Not all FDI is created equal. China uses FDI to buy influence. They’ve done it all over Africa to the benefit of the Africans (or at least the regimes). Want a railroad, China will build it for you, no strings attached. Want a railroad, the World Bank will line up Western banks and the investment comes with all sorts of strings attached. In this case, China is rather shrewd buying a potential partner in the Anglosphere.

  • CapitalHawk

    This should not be surprising to anyone that understands that (a) London drives economic activity and tax receipts for all of the UK, (b) the City (for those not in the know, that is the nickname of the financial district of London) drives economic activity and tax receipts for London and (c) there is a long and deep relationship between movers and shakers in the City and Hong Kong, with many of them spending a good portion of their careers in Hong Kong. If the government of the UK wants to keep the City going (and you’d better believe it does, probably more than almost anything else), it makes perfect sense to make certain that they keep their “special relationship” with Hong Kong going for as long as possible.

  • Joseph Stalin

    This is a rather strange move by Britain. Sad! The US global investment banks can start to move out from London city to other big financial centre in Europe and the candidates would be Frankfurt or Dublin.

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