Reeves Commits to Improving UK's Prosperity During China Visit

The Treasury has stated that improving the welfare of working people in Britain will be a key priority for the Chancellor during her visit to China, despite criticism of her decision to travel.

Rachel Reeves will meet with her counterpart in Beijing this weekend to discuss trade and investment opportunities as part of efforts to boost the UK economy and increase living standards.

The trip has been overshadowed by UK borrowing costs reaching a 16-year high and the pound's decline, with Conservatives accusing Reeves of "fleeing to China."
While visiting Brompton's Beijing store, Reeves stated that she would not change her economic plans.

"Growth is the number one mission of this government," she said.

"The fiscal rules laid out in the Budget are non-negotiable. Economic stability is the bedrock for economic growth and prosperity."

But market fluctuations could give Reeves a hard time in making her self-imposed fiscal targets. She has pledged to avoid borrowing for day-to-day spending and to lower debt to a percentage of national income by the end of this parliament.

Governments will usually spend more than they take in as tax revenues and so have to borrow to make ends meet, often by selling bonds to investors.

But in the last few months, borrowing costs for the UK have risen and this week reached the highest borrowing cost over a period of 10 years since 2008. The pound also slipped below that $1.22 on Friday.

This market jostle is coinciding with stagnated growth in the UK economy, and firms have started preparing for tax increases that will take effect in April.

The Treasury stated that Reeves' visit to China answered a "commitment to explore closer economic cooperation" between Prime Minister Sir Keir Starmer and President Xi made last year.

China, being the second largest economy in the world and the fourth most significant individual trading partner to the UK, is vital to the economy of the United Kingdom. The Treasury noted that exports to China supported over 455,000 jobs in the UK in 2020.

However, officials said the Chancellor would also address "difficult issues" with her counterpart, Vice Premier He Lifeng, including urging China to end its "material and economic support" for Russia's war against Ukraine, as well as raising concerns about rights and freedoms in Hong Kong.

"By finding common ground on trade and investment while being candid about our differences and upholding national security as the first duty of this government, we can build a long-term economic relationship with China that works in the national interest," Reeves said in a statement.

The government said in its release that it would also discuss other areas including 'reducing barriers' for British businesses interested in exporting or expanding in China. But it is also about promoting now existing financial services trade in Shanghai with respect to the presence of fresh partners.

Reeves will join the leadership with Bank of England Governor Andrew Bailey, Financial Conduct Authority CEO Nikhil Rathi, and other senior representatives from some of Britain's leading financial services firms.

The visit also follows concerns raised by MPs regarding the supply chains of fashion retailer Shein, which has its origins in China, with allegations of forced labor and human rights abuses. Shein has denied these allegations time and again.

On Tuesday, a top lawyer representing Shein repeatedly declined to respond as to whether the company sells products with cotton originating from Xinjiang, an area where China is accused of using forced labor involving Uyghur Muslims.