A diplomatic thaw after years of tension
Sir Keir Starmer’s visit to China this week is the clearest sign yet that the two countries are seeking to end the diplomatic “ice age” that has defined their relationship.
Both leaders face economic pressures at home and are seeking new opportunities for trade and investment.
For Sir Keir, the first UK prime minister to visit China since Theresa May in 2018, the trip was an opportunity to highlight the strength of British firms in finance, pharmaceuticals, healthcare, clean energy and car manufacturing.
Chinese President Xi Jinping, meanwhile, aimed to show that China can be a reliable partner for Western economies as US President Donald Trump continues to disrupt the global trading system.
Although no sweeping free trade deal was reached, the visit marked a cautious but tangible reset of UK–China economic relations.
What deals were agreed?
The most significant commercial announcement came from AstraZeneca, which pledged to invest $15bn (£11bn) in China over the next four years to expand research and pharmaceutical manufacturing — the company’s largest investment in the country to date.
In the energy sector, Octopus Energy is entering the Chinese market for the first time through a partnership with local firm PCG Power to develop a digital electricity trading platform. The project aims to improve efficiency and support China’s transition to renewable energy.
Octopus Energy CEO Greg Jackson said China’s scale and innovation had driven down the cost of solar, wind energy and batteries, creating opportunities for British firms to develop solutions that reduce electricity costs.
China also agreed to halve tariffs on Scotch whisky, a move the UK government said could generate £250m for the British economy over the next five years. Scotch whisky exports are worth more than £5bn annually, with China among the fastest-growing markets.
Industry groups welcomed the decision, saying it would help Scottish distillers compete in an increasingly crowded global market.
Another outcome of the visit was visa-free travel for British citizens visiting China for up to 30 days for tourism or business. Both countries also agreed to cooperate on tackling migrant-smuggling networks.
What does China gain?
For Beijing, renewed ties with the UK – a major European economy and close US ally – signal that China remains a dependable partner for the West despite trade tensions with Washington.
Economically, the reset helps secure access for Chinese exporters of high-value goods such as electric vehicles, solar panels and clean energy equipment, while opening the door to increased Chinese investment in British services, finance and green technology.
Chinese state media described the visit as a step towards turning the “potential of China–UK cooperation into real achievements that benefit both peoples and the world”.
Challenges and balancing acts ahead
Foreign businesses have long raised concerns about operating in China, citing regulatory complexity, red tape and limited transparency.
Sir Keir’s Labour government has struggled to deliver the economic growth it promised, making the China visit a high-stakes test at home. Improving relations with the world’s second-largest economy has nevertheless been a clear priority.
The reset also requires careful diplomatic balancing. President Trump has warned countries, including the UK, about deepening commercial ties with China, following similar warnings issued to Canada.
Sir Keir has insisted Britain does not need to choose between Washington and Beijing, describing the approach as pragmatic engagement to support domestic growth while managing geopolitical risk.
At the UK–China Business Forum in Beijing, he described meetings with President Xi as “very warm” and highlighted agreements on visa-free travel and whisky tariffs as symbolic steps in rebuilding trust.
The visit comes amid a flurry of trips to Beijing by leaders from France, Canada and Finland, as countries seek to diversify trade and investment partnerships in an increasingly unpredictable global environment.
Source: BBC News
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