Economy

China steps up European charm offensive

Vidya Ram London | Updated on January 25, 2011 Published on January 11, 2011

A partnership on petroleum refining, a pledge to increase Jaguar Land Rover sales by 50 per cent and the long-term loan of two pandas. These were just some of the £2.6 billion worth of deals inked during the Chinese Vice-Premier, Mr Li Keqiang's visit to Britain, on the last leg of his European trip.

Mr Li Keqiang, widely tipped to be the successor of Premier Hu Jintao, has held meetings with the Prime Minister, Mr David Cameron, the Deputy Prime Minister, Mr Nick Clegg, and the Treasury Head, Mr George Osborne, and is scheduled to address a group of business leaders later on Tuesday.

A total of 15 deals were signed on Monday, including a memorandum of understanding from Jaguar Land Rover to raise its sales of vehicles to 40,000 in 2011, from 26,000 the year before.

Recognised by the UK Government as one of the leading contributors to the exports between UJ and China, Jaguar Land Rover is committed to strengthening the trade relations between the two countries, the automaker said in a statement on Tuesday.

Deep-water exploration

BP has also signed an agreement for deep-water exploration in the South China Sea with China National Offshore Oil Corporation, while British chemicals firm INEOS, is selling stakes in refineries in Scotland and France to the China National Petroleum Company.

However, predictably, the most eye-catching deal of all was sealed between Edinburgh zoo and the China Wildlife Conservation Association.

Tian Tian and Yuangguang, two giant pandas will be given to the zoo for the next ten year, the first such gift given to the country in 17 years.

Bilateral trade in goods and services between Britain and China reached $51.8 billion in 2009, but hopes are that this will increase even further.

Mindful of concerns among European politicians, Mr Li Keqiang has been eager to stress China's plans for deeper reforms throughout his trip. “China will be steadfast in promoting reform,” Mr Li Keqiang wrote in an Op-Ed piece in the Financial Times earlier this week.

“It remains devoted to greater opening-up, follows a strategy of mutual benefit with other countries, and will open the country ever wider to the world.”

Earlier on the European trip, which began in Spain, Mr Li Keqiang provided reassurance of a different sort, with a pledge to continue buying the Spanish government debt.

China has already become a major buyer of Greek and Portuguese bonds, as it attempts to shore up confidence in its biggest export market, the European Union.

Last November, President Hu Jintao visited France, and secured a number of major deals, including the purchase of 102 Airbus planes.

In addition to encouraging investment from Europe, China is eager that the EU finally recognise its full market economy status, as well as removing barriers to high tech exports.

Published on January 11, 2011
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