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Boom time for UK trade with China

By Angus Mcneice in London | China Daily | Updated: 2017-11-04 07:12

Companies 'ahead of the curve' as investment shifts further inland

The United Kingdom was China's second-largest trading European Union partner in 2016, and its eighth-largest worldwide, according to a new study.

Britain did 55 billion pounds ($71.9 billion) of trade in goods with China last year, said the report from the Confederation of British Industry (CBI).

Germany came in first out of all EU nations, with 112 billion pounds ($146 billion).

The United States was China's top trading partner, doing $500 billion worth of trade in goods with China in 2016.

Britain, Germany and the US were the only economies from outside the Asia-Pacific Region to feature among China's top nine trading partners in 2016.

Guy Dru Drury, head of CBI China, said a strong trading performance with China is encouraging news for the UK as it prepares to exit the EU.

"As the UK forges a new global trading future, it is well ahead of the curve in making the most of its relationship with the world's fastest-growing economy," Drury said.

Transport technology, including automotive, rail, air, and maritime resources, accounted for 21 percent of British exports to China.

Machinery and electrical goods made up 12 percent of the UK's China-bound exports, followed by 8 percent in chemical products and 5 percent in metals.

The UK's top service export was travel, which accounted for $2 billion of exports.

Last year, a record 270,000 Chinese travelers visited the UK, and 91,000 Chinese students enrolled in British universities - far more than from any other country.

The UK was eighth worldwide in terms of foreign direct investment in China between 2006 and 2015, with investment totaling $5 billion during the period.

The study also found that, unlike most economies, the UK is shifting its focus from coastal to inland Chinese provinces, which have historically received a smaller share of foreign direct investment.

In 2015, British foreign direct investment in China totaled $4 billion. More than half of that went to inland regions, led by Heilongjiang province in Northeast China, which received $410 million of investment, and Henan province in Central China, which received $360 million.

As of the end of 2015, Heilongjiang had approved 69 UK-invested enterprises that focused on sugar and food processing, the wholesale and retail trade, manufacturing and advanced technology promotion.

One hundred enterprises in Henan province received some form of British investment in 2015.

British automotive engineering company GKN has a factory in Henan that has grown into Asia's largest producer of automotive cylinder liners.

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