UK and China selling new economic relationship as a win-win – but it’s complicated
The UK has laid out a new economic relationship with China, and to use one of China’s favourite phrases, both countries are selling it as a “win-win” situation.
It’s a significant development in restoring ties between the countries. The relationship has been beset by years of tension and suspicion. Both sides want to get it back on track.
China delivered a warm welcome for the chancellor.
Rachel Reeves was shuttled from a Beijing Brompton bike shop, to the Great Hall of the People and on to a state guest house.
China’s vice premier He Lifeng said: “The outcomes we have agreed today represent pragmatic co-operation in action.”
Chancellor Rachel Reeves with Chinese vice premier He Lifeng in Beijing. Pic: Reuters
Pragmatic. There is that word again.
Chancellor Reeves uttered it four times in her closing statement.
China is all for pragmatism, it’s one of the government’s favourite words.
It wants to show it is open for business and that its bilateral relationship with the UK is sound.
This trip is also symbolic for China. It still trades with Russia and is in competition with the US, so it wants to make it clear that it has friends in the West as well.
China regards it as a positive sign the UK has not sided with the US and European Union in applying tariffs to Chinese-made electric vehicles, solar panels and electric batteries.
However, if US president-elect Donald Trump escalates trade tensions with China, the UK may feel more pressure to side with the US.
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Despite the bonhomie, China is still likely to view these British overtures with caution.
For a decade the relationship has swung from its heyday of a so-called “golden era” to one characterised by growing concern about China’s role in the world.
There are complicated issues between the countries including alleged spying, cyberattacks, tension over Hong Kong, Taiwan, the South China Sea and China’s support for Russia’s defence industrial base.
When it comes to China the challenge for the UK is that it wants to have it both ways, carrying out trade while talking tough on difficult issues.
How the UK navigates its “let’s get down to business” policy in a complicated geopolitical environment will require the utmost diplomacy.
Sir Keir Starmer and Emmanuel Macron’s migrant deal comes into force today, with detentions set to begin by the end of the week.
The “one in, one out” pilot scheme – which allows the UK to send some people who have crossed the Channel back to France in exchange for asylum seekers with ties to Britain – was signed last week, and has now been approved by the European Commission.
Politics Hub: Follow live updates
It comes as 2025 is on course to be a record year for crossings.
Approximately 25,436 people have already made the journey this year, according to PA news agency analysis of Home Office figures – 49% higher than at the same point in 2024.
The prime minister and the French president hailed the deal as a “good agreement” when it was first announced during the latter’s visit to the UK last month.
The scheme also means that anyone arriving in a small boat can be detained immediately, with space set aside at immigration removal centres in anticipation of their arrival.
Sir Keir said the ratification of the treaty will “send a clear message – if you come here illegally on a small boat you will face being sent back to France”.
Ministers have so far declined to say how many people could be returned under the deal, however, there have been reports that under the scheme only 50 people a week will be returned to France.
Analysis: Deal will need to go much further to work
Sky News political correspondent Rob Powell said while it was a “policy win” for the government, the numbers must eventually “go a lot higher” than 50 per week if it is to work as a deterrent.
“The average crossing rate is about 800 a week, so this will need to go up by a sizeable factor for that message to start seeping through to people trying to make that crossing,” Powell added.
The aim will be to make asylum seekers believe the “risk of going back to France is so big that they shouldn’t bother parting with their cash and paying smugglers” to make the crossing.
Read more:
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Migrants in Dunkirk, France, preparing to cross the English Channel.
The Conservatives have branded the agreement a “surrender deal” and said it will make “no difference whatsoever”.
Under the terms of the agreement, adults arriving on small boats will face being returned to France if their asylum claim is inadmissible.
In exchange, the same number of people will be able to come to the UK on a new legal route, provided they have not attempted a crossing before and subject to stringent documentation and security checks.
The pilot scheme is set to run until June 2026, pending a longer-term agreement.
Home Secretary Yvette Cooper will face questions on the agreement on Sky News Breakfast this morning.
US Representative Dina Titus asked the CFTC to investigate Brian Quintenz, US President Donald Trump’s pick to run the agency, over his ties to Kalshi.
The CFTC is seeking feedback on how to more effectively regulate spot crypto trading as it moves to implement recommendations from the Trump administration.
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