Prime Minister Tony Blair's speech at the China-Britain Business Council conference
Tuesday 8th December 1998
It is a great privilege to be here this morning to open your conference, which stems in part from my visit to China in October, my first visit there as Prime Minister.
Although I was only able to visit Beijing, Shanghai and Hong Kong, I was tremendously impressed by the visible evidence of China's rapid economic development. By the scale of its drive to modernise its infrastructure. And by the evident will of its leadership to make sure that China is a major player both economically and politically in the next century.
The overall strategic objectives of my visit were clear. To put our past differences over Hong Kong behind us and build a new partnership between Britain and China, and to make Britain China's number one business partner in Europe. I was also keen:-
* to cement my personal relationships with President Jiang Zemin and Premier Mr Zhu Rongji;
* to project an image of a modern Britain committed to China, and to China's development into the 21st Century;
* and to explore how Britain can help China realise its aspirations in both the political and economic fields.
Britain and China can both take satisfaction over the successful handover of Hong Kong. We can now build a new relationship unhindered by the legacy of history. I was delighted by the warmth of my reception in China at all levels, and by the atmosphere of my discussions with the Chinese leaders. We have a wonderful opportunity to move forward with new links in new areas. I am for example pleased by the way in which we and the Chinese Government have been able to work together over the international financial crisis. We are particularly looking forward to Jiang Zemin's State Visit to Britain next year.
Britain is a friend to China, but not an uncritical one. As a friend, we need to make our views clear where necessary, for example on the subject of human rights and personal freedom in China. But it is easier - and more productive - to say these things in the context of a warmer and wider relationship. We can be constructive as well as frank. We can engage in dialogue at all levels while maintaining an atmosphere of mutual respect. That this is now possible is a clear sign of the maturing relationship between Britain and China.
On the economic and commercial side, the prospects are limitless, despite problems elsewhere in Asia. In particular, I believe that China is ripe for British investment.
China has made it clear that the days of politically inspired deals and contracts are over. We should applaud this. Chinese administrative procedures in the past have been notoriously slow, but China is now beginning to move more and more into line with internationally accepted business practice. Increasingly, British and Chinese companies should be able to negotiate and conclude business contracts on their own merits at the right time. This will be a great step forward.
What it does mean though is that business must compete even harder to win business and new orders.
Earlier this year, Shell successfully negotiated a US$4.5 billion petrochemical project in Nanhai - the largest single petrochemical project ever in China, and the largest ever foreign joint venture of any kind. More recently, Zeneca has been given final approval for its US$85 million joint venture to construct a herbicide manufacturing plant in Nantong. I am delighted that the approval process has now been completed. Construction is due to start in April, and the plant will be on-stream by the end of the year 2000.
While I was in China, National Power were able to sign a contract to invest around US$200 million in a build, operate and transfer power station project in Changsha; Standard Chartered were awarded a new bank branch licence for Beijing; and confirmation was given for the start of direct flights between London and Shanghai, which will be of considerable benefit to the business communities in both great cities. Good business deals with practical benefits for the UK and China. And, sporting links can also be business links. I am pleased to say that Crystal Palace are now in the process of negotiating the transmission of six home games on Chinese television in the first half of 1999. And the club are planning to take its first team on a tour of China next July.
So there is good news to report. We remain by far the largest European investor in China with over US$12 billion in contracted investment so far and more than 2,000 British joint ventures. But we can and should be doing better with our exports. These grew by 25% in 1997, but have slowed down this year. Asia's recession is likely to make things tougher still in future. We are still being out performed by our major European competitors.
But I hope and believe that our improved relationship with China, this conference, and the combined efforts of the Government and the China Britain Business Council can lead to a significant upsurge in our exports to China.
This Government will play its full part to help British companies compete in the China market. The Britain in China 1998 campaign has raised awareness within China of the full extent of British involvement, both business and cultural. All of our events and initiatives in China this year have been badged with a common logo. TV advertisements, the production of a Chinese language magazine mailed to over 10,000 prominent Chinese contacts and decision-makers have all helped.
There have been more high-level visits this year than ever, and the same is likely to be true next year. We are not likely to lack political profile in China. High-level visits in our direction are also on the increase.
We are stepping up our efforts to promote British companies overseas through a modernised and strengthened FCO and DTI effort. In China we will be mounting further trade fairs and exhibitions, such as the British participation in the Kunming Horticultural Expo 1999 - an example of Government and business working together. We want to continue the Britain in China campaign to build on the momentum achieved during this year. I will give this my full personal support.
Business will play its part too. As you all know, China is a tough, complex and competitive market. It requires long-term commitment. And it requires the development of personal relationships, so crucial to business success. It is hard work. But it pays off.
And let me pay full tribute to the China Britain Business Council and the major role it plays. It has a high reputation in China and its network of offices provides a wide range of support services to British business. It enjoys the Government's full backing. It deserves your full support too. I know that Sir Charles Powell and his fellow Directors will be doing all they can to boost the Council's efforts further. I hope that one tangible result of this conference will be a significant increase in its business membership. This will enable Government and British business to work even more closely together.
Our aim is nothing less than to make Britain China's number one business partner in Europe for both trade and investment. This may be a demanding target. It is not an impossible one. You will have this Government's full support in achieving it. The message that must go out from this conference is that Britain and China mean business.