Sino-UK ties bring mutual benefits

Northern England business insiders favor stronger economic, investment relations

Despite recent talk in the West of "de-risking" of relations with China, businesspeople in Northern England have made a case for stronger trade links, voicing optimism about the benefits of forging long-term partnerships.

About 50 business representatives of companies across sectors based in Yorkshire attended the China-Northern England Cooperation Forum, themed "Partnership for a Prosperous Future", in Leeds on July 17.

The forum was organized by the China-Britain Business Council, or CBBC, and the China Chamber of Commerce in the UK. Zheng Zeguang, China's ambassador to the United Kingdom, made the keynote speech at the forum.

"The world economy is facing multiple headwinds. Major developed economies are not performing so well, and the recovery of developing countries is also facing difficulties," Zheng said. "This highlights the need for even closer cooperation between China and the UK."

According to the UK Department for Business and Trade, the total trade in goods and services between China and Britain was 111 billion pounds ($143.3 billion) last year, up by 18.3 percent compared with 2021.

"Exports to China will certainly help to generate growth in this country, and investments from China in the UK will help to create more jobs and tax revenues," Zheng said, adding that foreign direct investment stocks exceeded $50 billion.

"We welcome British businesses into the Chinese market, as China has been striving to build an open, fair, and law-based business environment. We hope the UK government will do the same," Zheng said. "That is why we have voiced our concerns on certain measures that people have put in place in this country, for example, overstretching the concept of national security."

Claire Urry, chief commercial officer of the CBBC, said there have been more challenges to business relations this year, but the CBBC and its 500 member companies remain committed to long-term development in China.

"Economic and trade and investment ties are the foundations of our wider relationship. So we believe it's really imperative that the world's second and sixth-largest economies continue to engage and work together," said Urry in her opening remarks.

"We remain optimistic about the market in China and we will continue to work with all of you and your teams to increase bilateral engagement in order to achieve those mutual benefits," she added.

Building partnership

For Keith Jackson, CEO of Brandon Medical, a good partnership is crucial for doing business in China. As a designer and manufacturer of medical equipment for operating theaters and intensive care units, the company needs to navigate different systems when exporting its highly specialized equipment.

Jackson said the company has forged a strong strategic partnership with a Chinese company in Beijing over the past two years.

"We've been working through our regulatory approvals … and we should have our approvals in September," he said, adding that because of the aging population, China will become its biggest international market with "no question".

As a country with more than 400 million people in the middle-income group, China is also seen as a dynamic consumer goods market, where people with various tastes seek all kinds of high-quality goods to improve their lives.

John Gyngell, the co-founder of North Brewing, recalled that when the company opened a brewery in 2015, he looked to export, and attended an expo in Shanghai, which began the company's longtime partnership with Chinese distributors.

"China quickly became our No 1 export country," Gyngell said. The company, which pioneered the craft beer trend in Britain two decades ago, now exports to 27 countries.

"We love working with local brewers and distributors in China," he said. "Setting up things the first time around to export was tricky, but once you navigated that, it's been relatively plain sailing."

Chris Black, managing director of Sound Leisure, a family business making classic jukeboxes, said the company started looking at exports to China in 2019 and has since shipped jukeboxes worth 500,000 pounds to the Chinese market.

"We see China over the next 12 months as becoming our largest export, so that's above America, which has traditionally been our largest partner," Black said, adding that he hopes to visit China later this year.

Apart from local exporters, representatives of Chinese companies' UK branches in Northern England also attended the forum to share their stories of doing business in Britain, which they said brings mutual benefits and understanding.

Fang Wenjian, chairman of the China Chamber of Commerce in the UK, said he has witnessed phenomenal growth in the past 20 years. In total, the number of Chinese companies registered in the UK has exceeded 10,000, he noted.

Fang said among Chinese companies that have operations outside London, 44 percent are operating in Yorkshire and the Humber area. "There are more companies expressing intentions to expand and invest further in this area. So this really indicates the growing appeal of this area for Chinese companies," he said.

The Hong Kong Stock Exchange-listed Minth Group established its UK branch in Sunderland in 2018, and Xiong Weibo, general manager of Minth Automotive (UK), said the branch is running successfully with only two Chinese employees and 70 local staff.

"In the future, Minth will be looking forward to increasing the investment in the UK," said Xiong. "We also want to bring more high-tech and good solutions to the UK from China to help reduce carbon emissions in the auto industry."

For Chinese home appliance giant Midea, integrating with the local community and culture was the first step to doing business abroad. Liu Tao, general manager of Midea Home Appliances UK, said the company sponsored the Manchester City soccer team in 2020 before opening its UK headquarters office in the city this year.

"Although our team now in the UK is still very small, we are creating a long-term recruitment plan for many positions, as we want to be a player in the UK for many years to come," said Liu.

Ian Zhu, China consultant at Grant Thornton UK LLP, a global leading professional services network of independent accounting and consulting firms, said the organization has been providing services to assist many Chinese companies, such as Hisense and CISDI, to forge strong growth in the UK.

"We are positive that it's beneficial to Chinese companies coming to the UK market as they create local jobs and provide more choices for British consumers," said Zhu. "And we are dedicated to helping them to have a better understanding of local compliance and get accustomed to the UK business environment."