Opposition: "Absent While Markets Are Unstable"
Amid growing concerns about the UK’s finances in the financial markets, Chancellor of the Exchequer Rachel Reeves is visiting China to strengthen trade and economic relations.
On the 10th (local time), Chancellor Reeves begins a three-day visit to China. In Beijing, she will meet with Vice Premier He Lifeng, considered a key figure in the Chinese economy, and in Shanghai, she will meet with British companies operating locally.
Accompanying Reeves on the trip are Andrew Bailey, Governor of the Bank of England; Nikhil Rathi, Chief Executive of the Financial Conduct Authority; and executives from HSBC and Standard Chartered (SC).
Bloomberg reported that after her visit to China, Reeves is expected to deliver a speech within weeks aimed at easing market concerns about economic growth prospects and government finances.
Recently, the UK economy has shown signs of slowing down. Concerns over global inflation due to the second term tariffs under Trump and fears of stagflation (economic stagnation accompanied by rising prices) in the UK have pushed the 10-year UK government bond yield to its highest level since the 2008 financial crisis. The sharp rise in government borrowing costs is raising worries that it will put pressure on the fiscal plans of the Keir Starmer government.
This visit to China is part of the Labour government’s efforts to improve relations with China as it faces the urgent challenge of economic growth amid a recent sharp decline in approval ratings. Last October, Foreign Secretary David Lammy visited China, and in November, at the G20 summit held in Brazil, Prime Minister Starmer held a summit meeting with President Xi Jinping. Additionally, according to the BBC, the UK government is considering resuming the annual economic dialogue with China, which has not been held since the COVID-19 pandemic.
Relations between the two countries had frozen due to conflicts over China’s Hong Kong National Security Law and allegations of Chinese cyberattacks on UK public institutions.
However, the UK’s main opposition party, the Conservative Party, criticized the Chancellor for being absent while financial market concerns about the UK’s finances are spreading.
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