China and Brexit: what’s in it for us?

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Series Details September 2016
Publication Date September 2016
ISBN 978-1-910118-87-0
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In contrast with gloomy assessments from Japan amongst others, China sees Brexit as a source of major opportunities for China’s economy and international standing, according to a new report from ECFR published in September 2016.

China and Brexit: What's in it for us? - a special issue of ECFR’s China Analysis series - looks at the first published Chinese commentaries in the wake of the Brexit shock in June 2016. While there are nods to concerns around increased uncertainty and the potential loss of the UK as a gateway for EU investment, Chinese authors are markedly more upbeat than their east Asian neighbours in terms of their prospects after Brexit.

Chinese authors seem to concur with the view of Brexit supporters that a more independent UK will be better able to agree a mutually beneficial free trade deal with China – a prospect officially confirmed as a possibility by China’s Ministry of Commerce. While such a trade deal would have intrinsic economic benefits – with Chinese expectations that Britain will remain a large economy even after Brexit - it would also likely increase the attention Britain gives to China more broadly, which is where the real benefits are seen.

According to Chinese sources, such a deal would make the UK more dependent on China and therefore more likely to advocate for China’s interests in international fora. Li Xiaopeng argues that this dependence will lead Britain to promote renminbi internationalisation 'even more', while Zhao Hongwei sees post-Brexit UK as 'the leading voice' supporting China’s ongoing bid for market economy status (MES). The possibility of the UK lifting an embargo against arms exports to China is another area where Britain’s new-found independence from Europe – and dependence on China – could bear fruit for Asia’s largest military actor.

A divided Europe is seen as an additional opportunity for China. Chinese scholars expect that Brexit will weaken the EU’s position on its own values, leading to a softer European posture on Chinese human rights abuses. Economic competition between the UK and EU for Chinese investment is also seen as likely to lead to better terms for Chinese companies. London’s recent delay of the £18 billion Hinkley Point C nuclear power plant out of concerns about China’s 30 percent stake in the highly sensitive nuclear project is viewed as an exception in this sense.

Source Link http://www.ecfr.eu/publications/summary/china_and_brexit_whats_in_it_for_us7112
Related Links
ESO: Background information: Japan Lays Out a Guide to Brexit http://www.europeansources.info/record/japan-lays-out-a-guide-to-brexit/
ESO: Background information: G20: Theresa May faces Brexit trade pressure http://www.europeansources.info/record/g20-theresa-may-faces-brexit-trade-pressure/
ESO: In Focus: Brexit - The United Kingdom and the European Union http://www.europeansources.info/record/brexit-the-united-kingdom-and-the-european-union/
ESO: Background information: Brexit and the UK's China Challenge http://www.europeansources.info/record/brexit-and-the-uks-china-challenge/
Chatham House: Expert Comment, 21.06.16: China Would Not Abandon UK After Brexit https://www.chathamhouse.org/expert/comment/china-would-not-abandon-uk-after-brexit
ECFR: Podcast, 13.09.16: ECFR’s World in 30 Minutes: How China and Asia see Brexit http://www.ecfr.eu/podcasts/episode/ecfrs_world_in_30_minutes_how_china_and_asia_see_brexit
The Conversation, 16.09.16: Hinkley C power project offers a lesson in how not to deal with China http://theconversation.com/hinkley-c-power-project-offers-a-lesson-in-how-not-to-deal-with-china-63573
ESO: Background information: Government confirms Hinkley Point C project following new agreement in principle with EDF http://www.europeansources.info/record/government-confirms-hinkley-point-c-project-following-new-agreement-in-principle-with-edf/
The Conversation, 11.01.18: The forecast for British-Chinese relations in 2018: a storm on the horizon https://theconversation.com/the-forecast-for-british-chinese-relations-in-2018-a-storm-on-the-horizon-89424
The Diplomat: UK-China relations https://thediplomat.com/tag/china-uk-relations/
Politico, 08.12.17: Brexit Britain looks to China https://www.politico.eu/article/brexit-britain-uk-looks-to-china-trade-investment/
Chatham House: Project, May 2017: Brexit: Implications for EU–China Relations https://www.chathamhouse.org/publication/brexit-implications-eu-china-relations

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