Moving on from the divorce

UK's withdrawal from the EU has brought fresh uncertainties to China's relations with both

The United Kingdom's withdrawal from the European Union is a great crisis in the history of European integration. It will also have a great influence on the world economy and international politics.

With the UK leaving the bloc, the EU has lost an important economic market of more than 66 million people, while the UK has lost the potential support of the EU at the international level, which will force the UK to make political and security adjustments in the future.

The first EU leaders' meeting after Brexit was held recently, with the participating countries fighting for their own interests. The UK, on its part, has begun the arduous task of trade negotiations with the EU which will continue for the next 10 months. The UK's divorce from the EU will also have an impact on China-UK relations, and it has affected the geopolitical relations in Europe, which will make relations between the EU and China more complex. In addition, it will bring variables and challenges to the relations of the UK and the EU with the United States.

But although Brexit will influence China and the UK in terms of their economic relations and strategic partnership, the negative impacts are not enough to affect the overall situation. After all, China and the UK have a solid foundation and development space for close economic and trade cooperation and cultural exchanges. In order to avoid being marginalized in international relations, the UK will actively maintain friendly relations with China, the US and other major countries in the short and medium term. Of course, China also needs a multipolar world, including the UK and the EU. The relationship between the UK and the US is "special", but the UK will consider its strategic autonomy. For a long time, the UK has played the role of mediator between the US and the EU. In order to maintain international influence in the field of international politics and security affairs, it is bound to strengthen its strategic alliance with the US. However, the UK will not let the US dictate the terms of the relationship. For example, in the technology field, the UK government has allowed Huawei to participate in construction of its 5G network despite US pressure to do otherwise.

Good economic relations are the foundation of friendly China-UK relations. Since 2015, when entering the "golden age" of relations, the two sides signed trade and investment agreements covering energy, health, science and technology, financial services, education and other fields. The UK has always advocated that Europe open its market and recognize China's market economy status, which is different from that of the EU. After Brexit, it is now easier for the UK to reach an agreement with China on a free trade agreement as it can make compromises that the EU was not willing to make because of the diverse interests of its members. It will also be careful that Brexit does not lead to the continuous decline of the UK currency, which would also threaten the stability of the eurozone. London's renminbi financial products entering the EU market will face higher transaction costs, which will have a certain impact on the internationalization of the renminbi and China's strategy to diversify its currency storage.

The UK will be more pragmatic in its relations with China, but China should be wary of the emergence of unilateralism, because the UK will maintain closer coordination with the US in its policy toward China. The UK may follow the US lead and intervene in Asia-Pacific affairs. For the EU, the departure of the UK will increase the influence of Germany, France and other European powers, and differences between the European Continent on the one hand and the UK and the US on the other may intensify. The EU and the UK still need to maintain some cooperation on security issues, because they also face common threats, such as terrorism. And in order to maintain the international status of the pound, the UK will actively establish good relations with China. All sides should give full play to the positive role of reform of the global financial governance and monetary system.

China hopes the UK and the EU will make a smooth transition to a new relationship. From the perspective of long-term development of China-EU relations and China-UK relations, as long as all parties continue to adhere to the principles of mutual respect, do not harm each other's core interests, enrich the connotation of cooperation, then new achievements will be made.

Shi Zhiqin is a professor in the Department of International Relations at Tsinghua University. You Nan is an assistant research fellow in the same department. The authors contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.