Theresa May has sidestepped a Chinese push for a formal endorsement of its $900bn Silk Road strategy, suggesting Britain still has concerns about China’s political objectives for the huge infrastructure project.
Government sources confirmed that the UK did not sign a memorandum of understanding giving Britain’s official endorsement to the $900bn Belt and Road Initiative, a personal project of the president, Xi Jinping.
Critics have said the project is designed to pull other countries in the region deeper into China’s sphere of influence, and that it could give unfair preferential treatment to Chinese contractors.
In a press conference in Beijing on Wednesday with the Chinese premier, Li Keqiang, May said the UK was “a natural partner” for the project but stopped short of giving the scheme her unequivocal backing.
Instead, the prime minister, who is on her first bilateral trip to China, said the two countries would continue to work together “to identify how best we can co-operate on Belt and Road across the region and ensure it meets international standards”, indicating that agreement might not have been reached.
“There wasn’t a memorandum signed,” a UK government official said. “They both spoke positively about the potential impacts it could have. But it’s important it’s implemented in the right way. They are going to carry on talking.”
Beijing had hoped to seal the UK’s backing after the chancellor, Philip Hammond, attended the Belt and Road Forum for International Cooperation in Beijing last year. China still lacks a significant western endorsement; Australia, France, Germany, the European commission and US have not given it their unqualified backing.
On a visit to China this year, the French president, Emmanuel Macron, said he had reservations about the project and that the initiative should benefit the region not be a “one way street”.
British reluctance to commit to signing the memorandum caused consternation ahead of the meeting between UK and Chinese officials, with the Chinese even reportedly refusing to answer calls from their British counterparts. British officials said there was not a formal list of demands that the UK wanted met before the memorandum would be signed.
“It is generally about adhering to international standards, making sure there is transparency in the supply chain,” the official said. “It’s about ensuring the tendering process is fair and equitable.”
At the press conference, May also stressed the need to adhere to fair trading practices, and said she had raised concerns about intellectual property theft with Li, which is also a key gripe of Donald Trump, the US president.
“As partners committed to global free trade we can work to ensure that as our companies innovate and develop new products, they are confident that their intellectual property and rights will be fully protected, including against cyber threats,” she said.
As the prime minister detailed her concerns, Li interrupted to raise steel dumping as another area where they had clashed, giving the prime minister a smile. The prime minister thanked Li for “reminding us” that they had discussed overcapacity in global markets and the need to tackle unfair trading practices.
Downing Street said China had already made a commitment to cut steel capacity by 200m tonnes by 2020, and had already cut 100m tonnes since 2016.
At her press conference with Li, May said a “significant number of major new commercial deals” were due to be agreed during her visit, expected to total over £9bn in value. In turn, Li made encouraging sounds about a future UK trade deal as well as opening Chinese markets more generally to UK agricultural products.
“The two-way opening up between China and the UK will go even further and China will open even wider to the UK,” he said. “In line with our agreement, China will expand openness to UK products including agricultural products. China will import UK products that are needed in the Chinese market.”
The prime minister said they had agreed to carry out a joint trade and investment review to identify priorities for promoting growth in goods, services and investment. It included agreement by the Chinese to make progress over the course of the next six months on lifting the BSE ban on British beef exports.
May had also pledged to raise the issue of human rights abuses and the deterioration of Hong Kong’s democratic protections in her meetings with Li, which the premier said the pair had discussed alongside the threat from North Korea and the implementation of UN sanctions, as well as future trade.
The prime minister herself, however, made no mention of her concerns during the 30-minute press conference in Beijing’s Great Hall of the People. On Thursday she will hold a bilateral with Xi, where it was expected, Downing Street said, that foreign affairs and security would be the focus of the discussion.
Joshua Wong, Hong Kong’s most prominent pro-democracy youth leader, urged May to confront Xi over his “relentless crackdown” in the former colony. “Theresa May should speak out on Hong Kong during her visit to China instead of having an empty talk with Emperor Xi,” Wong said on Wednesday.
