UK Treasury Chief to Visit China to Revive Economic Talks

UK Treasury Chief Rachel Reeves

The Treasury confirmed on Friday that Reeves will visit Beijing and Shanghai, where she is scheduled to meet with Vice Premier He Lifeng, China's key economic official. Her trip is expected to breathe new life into the China-U.K. Economic and Financial Dialogue — a series of annual bilateral talks suspended since 2019 due to the COVID-19 pandemic and increasingly tense relations.

Over the past few years, multiple issues have strained the relationship, including espionage allegations, China's backing of Russia in the Ukraine conflict, and a crackdown on civil liberties in Hong Kong, a former British territory. These concerns have overshadowed the once-promising ties between the two countries.

Reeves’ delegation includes Bank of England Governor Andrew Bailey, U.K. Financial Conduct Authority Chief Executive Nikhil Rathi, and senior representatives from several of Britain's leading financial institutions. Media reports suggest that executives from major firms like HSBC Holdings and Standard Chartered will also join the mission.

This diplomatic push follows recent visits by other senior British officials. In October, Foreign Secretary David Lammy traveled to China, and in November, Prime Minister Keir Starmer met Chinese President Xi Jinping at the G20 summit in Brazil. These engagements are part of Starmer’s broader strategy to strengthen political and economic ties with China, the U.K.'s fifth-largest trading partner.

Officials close to Starmer have emphasized the importance of a "pragmatic" approach in dealing with Beijing, particularly on issues like global stability, climate change, and the transition to clean energy. However, this shift in policy has faced criticism from the opposition Conservative Party, which has raised concerns about national security and human rights in China.

The Conservative Party has repeatedly warned of security risks posed by China, particularly after recent revelations that an alleged Chinese spy had infiltrated British circles, including close ties with Prince Andrew. These incidents have further fueled concerns about the Chinese government's activities in the U.K.

Despite these tensions, Lammy defended the Labour government’s approach, noting that many areas of trade do not pose national security risks. He reiterated the U.K. government's commitment to a balanced relationship with China, stating, "We are guided by three Cs: challenge, compete, and cooperate, particularly in global health and climate issues."

Reeves is expected to echo Lammy’s message in her upcoming discussions, signaling the U.K.'s intention to engage with China on key global challenges while managing the complex dynamics of the bilateral relationship.