World Economy

UK rolls out red carpet for China’s President Xi Jinping

China's President Xi Jinping is spending most of this week in the U.K. — and his itinerary reads like the ultimate visiting Britain to-do list.

Yet between the trips to Buckingham Palace, Downing Street, and naturally Manchester for the football, some serious dealmaking is likely to be announced.

Chinese President Xi Jinping.
Getty Images

Nuclear power, oil, rail travel and even new super-material graphene are likely to be the subject of Chinese investment in a boost for the Conservative-led U.K. government's assiduous courting of China in recent years.

"Beijing has rewarded Chancellor George Osborne's persistence," Robin Niblett, director of influential U.K. world affairs think tank Chatham House, wrote in a paper published Monday.

This may already have paid off in terms of top-line growth, with British exports to China up from £7.3 billion in 2010 to £15.9 billion in 2014, according to the U.K. government.

A video called Britain meets China, broadcast on YouTube and its Chinese equivalent and produced for the occasion of Xi's visit, focuses on education, football and London taxis as cross-cultural references. Its overwhelmingly sweet tone is only slightly marred by, for example, the rather more impressive command of English demonstrated by a Chinese schoolboy than his English counterpart has of Mandarin.

Watch the video: 'Britain meets China'

The video, according to media reports, is produced by Fuxing Road — the same name behind "When China met Carolina," which showed U.S. workers talking about working for a Chinese company and published ahead of Xi's visit to the U.S. in September.

Watch the video: 'When China met Carolina'

Still, there are worries that the U.K. may be heading down the Silk Road at slightly the wrong time, as China's gross domestic product growth hits its lowest levels since the financial crisis.

It risks neglecting the development of its relationship with other key emerging markets like India, Niblett pointed out.

There are also concerns that the U.K. risks damaging diplomatic ties with allies like the U.S. and Japan over its courtship of the Chinese. China's relationship with both the U.S. and neighboring Japan remains uncomfortable. Despite a recent deal announced between Xi and President Obama, Chinese cyberattacks on U.S. companies appear to have continued.

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In retrospect, this may seem like one of the moments where the U.K. tacitly admitted the decline of its global economic influence. The expected deal to build a new nuclear power station at Hinkley Point, for example, will also be a slightly uncomfortable reminder that the U.K. has ceded its historic leadership in the development of nuclear power. Its first new nuclear plant for a generation will now be split between French and Chinese ownership — with hefty subsidies and the promise to pay a £92 per megawatt hour price from the U.K. government.