When the British prime minister, Sir Keir Starmer, visited China in January, his mission was clear. He said, “Like it or not, China matters for the United Kingdom”, and he wanted improved relations. Since China is the world’s second-largest economy, “a strategic and consistent relationship with them is firmly in our national interest”.

The UK has been reckless in its relations with Beijing, creating uncertainties that benefit nobody. In a short time span, it has lurched from a Golden Age to an Ice Age, an exercise in self-harm if ever there was one. However, faced with the unpredictability of Washington’s tariff policies, the degrading of the UK’s so-called “special relationship” with the United States, and a ballooning national debt, Starmer appreciates that Britain can no longer afford the luxury of ideological gymnastics. Although the Sinophobes were incensed by his China outreach, he is determined to deal with the realities of life and deliver for the British people.  

This involves finding predictable partners, and no partner is more predictable than China. However, Beijing only wants to deal with serious actors and has no use for flip-floppers who imperil forward planning. When Starmer met President Xi Jinping, he insisted UK-China relations were in a “strong place”, and his challenge now is not only to demonstrate that this is so but also to make them stronger still.

Therefore, at the time of his visit, the two countries established agreements covering a raft of areas, including UK exports to China, the creation of a bilateral services partnership, and the Work of the UK-China Joint Economic and Trade Commission.

In an improving political climate, partly stimulated by Starmer’s endorsement of China’s London embassy project, the energy generated by his Beijing visit is becoming apparent. For example, at the first meeting of the UK-China Financial Working Group in February, Beijing not only recognized London’s role as a “leading offshore hub” for yuan trading, but also viewed it as one of the “largest, most vibrant and innovative” offshore yuan markets. Under a new financial cooperation agreement, easing cross-listing for firms in each other’s markets is now in the planning stage.  

Moreover, at the 8th China-UK Economic and Trade Forum, held in London on March 18, the theme was “United in Momentum, Deepening Collaboration for a Shared Future”. It was hosted by the China General Chamber of Commerce in the UK, and approximately 350 people from government, business, finance, and academia discussed new opportunities for bilateral cooperation in changing times.

In his keynote address, China’s ambassador to the UK, Zheng Zeguang, said his country’s development was bringing fresh opportunities for its global partners and injecting new momentum into China-UK cooperation. In words that would have resonated with Starmer, he said: “The rising turbulence in the world makes it all the more important for China and the UK to strengthen cooperation”. Instead of shying away when difficulties arose, it was important to do “the right thing”, by which he meant both sides should “charge ahead”.

If Starmer can stick to his guns and avoid self-defeating confrontations with Beijing (and if his successors do likewise), there is every reason to suppose his policy of pragmatic engagement will yield the economic benefits his government so desperately needs and for which the British people yearn

As an economic superpower, China has far more to offer the UK than vice versa. If former British prime ministers like Boris Johnson, Liz Truss and Rishi Sunak want to sour relations, it is no skin off Beijing’s nose. Although China undoubtedly appreciates the advantages of doing business with Britain, including in culture, education, e-commerce, and finance, it is certainly not dependent on the UK. That said, London is a global hub for finance and trade, and if Sino-British economic ties are deepened, everybody will gain. This is why Starmer sees Chinese investment in the UK’s key growth areas as integral to his government’s industrial strategy.

The UK’s economics minister, Lucy Rigby, told the forum that Britain wanted constructive and stable relations with China, a key contributor to economic growth. Practical cooperation in financial services and other areas would support growth, innovation, and job creation in both countries. She described China as an important partner for the UK — and she would have been justified in adding that it is becoming more important by the day.  

Indeed, Chinese-owned businesses in the UK already generate about 61,000 jobs and an annual revenue of 63 billion pounds ($84.06 billion). Not only is London now the largest offshore yuan trading center, but it has also hosted the issuance of the first Chinese sovereign and green bonds outside China. According to the 2025 Bank of China white paper on the yuan’s internationalization, London in 2024 had 156 billion yuan ($22.58 billion) in deposits, up 64.6 percent year-on-year.

It was undoubtedly with those figures in mind that the Lady Mayor of London, Susan Langley, shared with the forum her hope that, as British firms expanded into China, so more Chinese banks and financial institutions would establish themselves in the City of London.  

Starmer has described the UK’s economic growth as his “No 1” priority, and his overtures to China show he is on the right track. Strengthened cooperation will also undoubtedly promote stability amid growing global tensions. The signs are positive: AstraZeneca, Octopus Energy, and Brompton have announced new investment plans for China, while China’s Chery Automobile, JD, and Pop Mart have unveiled new projects in the UK.

Moreover, there is no reason why British businesses should not also take advantage of China’s 15th Five-Year Plan (2026-2030). As Zheng explained, the plan is outward-looking and aims to boost domestic consumption, foster innovation, accelerate the green transition, and expand high-standard opening-up. Important opportunities are materializing, and the UK’s business communities will have only themselves to blame if they do not seize them, allowing their rivals to muscle in.

Indeed, on Thursday, at the Boao Forum for Asia Annual Conference in Hainan, the chairman of the National People’s Congress Standing Committee, Zhao Leji, rammed home the same point. He emphasized that foreign firms could gain a competitive edge by investing in China, and that they would not only be welcomed, but also protected. For the business world, this is surely as good as it gets. 

If Starmer can stick to his guns and avoid self-defeating confrontations with Beijing (and if his successors do likewise), there is every reason to suppose his policy of pragmatic engagement will yield the economic benefits his government so desperately needs and for which the British people yearn.

The author is a senior counsel and law professor, and was previously the director of public prosecutions of the Hong Kong Special Administrative Region.

The views do not necessarily reflect those of China Daily.