“No economy in the world is as open to Chinese investment as the UK,” declared George Osborne on a visit in 2015. Few Western nations would make such a claim today, but the then-Chancellor was on an unapologetic charm offensive that took him to Beijing skyscrapers, interviews on bullet trains and parades in front of giant red flags.
Osborne batted away questions over human rights violations while claiming China stood up for free trade. He even touted the expanding global presence of tech titan Huawei as an example of how the ruling Communist party had embraced free market capitalism.
“There is always more we could be doing with China because I see China as an opportunity not a threat,” he said on one of his visits.
China was the future and Britain wanted to be front of the queue to reap the benefits.
The new “golden era” of UK-China relations that Osborne hailed has lost its shine in the years since, however. Old wounds stretching back centuries to the Opium Wars have reopened while the very 21st century issues of 5G and tech infrastructure security have created new sources of tension.
Kerry Brown, a professor of Chinese Studies at King’s College London, says relations were dominated by Hong Kong up until the handover in 1997 and the UK, like other countries, has attempted an “engagement policy” since.
“Under Osborne and Cameron, it became ‘let’s go for investment and trade’ and not get bogged down in complex arguments about values,” he says.
“The thing we are seeing now is the end of this engagement policy… China has not been what people thought it would be.”
Relations with Beijing have hit a low not seen in decades. Chinese technology will be ripped out of British infrastructure amid fears that Beijing is using the likes of Huawei to spy on the West.
Meanwhile China has said there will be “consequences” as a result of the UK’s opposition to it tightening its grip on Hong Kong with a new National Security Law. In 1839, Britain took the city state as part of an agreement with China to end the First Opium War before handing it back in 1997 under the “one country, two systems” agreement.
But that agreement has wilted as Beijing has undermined Hong Kong’s independence. Meanwhile economic power has shifted hugely in the last 23 years: UK GDP was more than 60pc larger than China’s in 1997 but is a fifth of its size today.
It has been a long five years for UK-China relations since Osborne’s kowtow. China’s ties to the UK have deepened even as tensions have grown. To understand the connections between the two countries, it’s important to look at each of the sectors that have, until now at least, welcomed Chinese investment with open arms.
Britain is a very open country, so China’s explosion into the world’s second largest economy has had sweeping effects on the UK.
China is the UK’s 6th biggest export market and fourth biggest source of imports, up from 26th and 15th back in 1999.
Similarly it is a major player in foreign direct investment. Including Hong Kong and mainland China, IMF data indicates it is a top 20 investor in the UK while it is the fourth-biggest recipient of British outbound investment.