On Wednesday night, I have the great privilege of hosting a Chinese delegation for a State Banquet at the Guildhall. I am delighted to return the wonderful hospitality that I, and my delegation of British business leaders, received in China last month, to celebrate the strong relationships that have been forged between our countries’ financial and professional services sectors, academic institutions, and creative industries.
As China continues on its path to becoming a modern, globalised economy, the UK is proud to enter a new golden era in our partnership for growth and prosperity. And while opening up new markets is exciting, episodes of volatility are to be expected. As Premier Li Keqiang has said, “achieving strong, sustainable and balanced growth is still a daunting challenge facing all of us”.
The City has faced many challenges over its 2,000-year history, has seen market volatility from every angle, and has helped create the systems which balance and stabilise markets. That is why this City has the unique expertise to support the stable development of China’s economy. We can help build resilience into China’s capital markets by working to deepen the institutional investor base, grow the insurance and pensions market, and improve transparency and predictability for international business.
London can also help China because it knows Chinese business; the capital has offices of all five major Chinese banks, the City of London RMB initiative, and the first clearing bank outside Asia for RMB. Now we can add to that the signing of the yuan-pound swap line, and the issuance of the first non-Chinese sovereign RMB bond, cementing London as the leading offshore centre for RMB trading. This will enable financial institutions across Europe to offer a broad range of RMB products and services for processing trade, and for investment.
What has driven this is the City’s belief in open and transparent markets, markets which function with two driving forces: the right framework in place, and the right people behind them. This includes the 250,000 Chinese who live and work right here in London, and the 135,000 Chinese students who are educated in Britain every year.
By the end of the year, we will have hit our countries’ bilateral trade target of $100bn. New and exciting developments are taking place every day, such as the announcement of Chinese investment into Hinkley Point nuclear power station, and SinoFortone Group’s initial £100m investment into the new London Paramount Entertainment Resort.
Two thousand years ago, Chinese merchants journeyed thousands of miles to bring silk to London. Now they are bringing steel, but it has always been the flow of financial and human capital which changes the future of continents. The future for London and China is bright; now is the time to capitalise on the opportunities that are available to all of us.