The U.K. Is 'Pound'-ing the Pavement With Chinese Business Deals
TAIPEI (TheStreet) -- China is teasing the United Kingdom this week with offers of stronger trade and investment ties with the world's second largest economy because the British have paused political activity that offends Beijing.
More contracts for British companies in industries such as finance and infrastructure are expected to be signed to coincide with Chinese Premier Li Keqiang visit to the U.K. this week. Chinese banks may get cozier with London as the only non-Asian center for renminbi currency trade. This would be a change from the past two years when China has been upset with the U.K.
China's dissatisfaction with U.K. stems from when British Prime Minister David Cameron met in 2012 with the Dalai Lama, an enemy of Beijing, and his government called China a country of concern in its 2013-2014 human-rights report. But now Chinese leaders have signed new deals to help British companies, allowing them to rival French and German ones that have received more favor from Beijing.
Advances for British companies could in turn put a squeeze on American peers such as alternative asset manager Blackstone (BX - Get Report) and General Electric (GE), which is involved in Chinese infrastructure."Before I came here, we used to say when we talked about Europe, it's Britain, France and Germany," China's ambassador to the United Kingdom, Liu Xiaoming, was quoted saying in Beijing's state-run China Daily newspaper. "But, unfortunately, many opportunities were missed in the past year or so, so now it has become Germany, France and Britain." Relations cooled after Cameron met the Dalai Lama, a spiritual leader of the Tibetan government in exile and a man Beijing calls a separatist. China now owns Tibet. Then last year Cameron visited China to "scout for investment to boost the cash-strapped British economy," China Daily said. That's flowery language for "begging."
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