Miliband’s China challenges

In a speech to the Shanghai Institute for International Studies (SIIS) last night, foreign secretary David Miliband, in a visit which looks to address issues ranging from intellectual property rights to sanctions against Iran, called on China to embrace “an inclusive and balanced form of globalisation” and urged his hosts to steer away from “destructive nationalism, embodied in protectionism that harms us all”.

Mr Miliband’s speech to the SIIS set out Britain’s future relationship with the emerging economic superpower. Of primary focus was free trade following the credit crunch, with the foreign secretary clearly aware of China’s temptation towards protectionism he stated that “it will require a determination to deepen globalisation, by opening up our economies further to flows of goods, services and capital”.

Encouraging China to embrace free trade, however, is not the UK’s biggest challenge. In 2003, the Chinese prime minister, Wen Jiabao, proposed a free trade zone across the Shanghai Cooperation Organisation and at the London G20 summit in 2009 President Hu Jintao talked at great lengths of China’s budding relationship with Russia and Central Asia.

As the world’s largest producer economy China has embraced and will continue to embrace free trade and free markets to encourage its future economic development, but its current priorities with regards to this growth lie with central and eastern Asia – not Europe. Persuading China to look to Britain will be Mr Miliband’s biggest challenge on this visit.

Currently less than 4 per cent of the UK’s trade lies with China (the UK is the largest European trader operating in China), a statistic the foreign secretary acknowledged, but he also went on to point out that:

“Britain’s expertise in finance, professional services, education, pharmaceuticals, advanced engineering, creative industries and digital technology, mean that as Chinese consumers move up the value chain there will be a better fit between our economies than ever before.”

Persuading China to look at Britain for increased trade, though, seems to be reliant not only on China’s willingness to look beyond Asia, but also China’s position on the key areas of intellectual property rights, climate change and the increasingly contentious issue of sanctions against Iran.

With China being accused of wrecking the Copenhagen agreements, implementing internet attacks on other nations and moving closer to Iran on issues regarding energy; Britain, Europe and the United States still seem unsure as to the country’s long term ambitions.

The foreign secretary’s speech yesterday highlighted these crucial areas, and although he did not explicitly state the UK’s position it seems clear that Mr Miliband is looking to encourage a more constructive dialogue between east and west. However, getting past these crucial sticking points seem unlikely in the near future.

Ultimately for the Chinese Communist Party, their goal is the maintenance of the Chinese Communist Party and as such issues which are beneficial to the Chinese people at the detriment of its relations with other nations are acceptable. This means that inaction on climate change and building relations with ‘rogue states’ such as Iran will be considered in the context of the country’s economic growth not its diplomatic standing with countries such as the UK.