By Mike Cormack – China in Britain Correspondent
International summits are funny beasts. Can you remember the last important policy that came from one? Me neither. And yet they are important in giving leaders space to talk, to build relationships and to demonstrate good will. Face time is always important in what is, after all, a field dependent on personality. Host nations also have a chance to show their ability to manage the show, as they strive to bring together resolutions that will serve as their legacy. The world is a much smaller place and carve-ups on the scale of the Concert of Vienna are no long possible, but with proximity everything is much more tightly linked, so problems can be sorted out (or pile up) so much more quickly.
The Hangzhou G20, then, is China’s chance to shine, another opportunity to claim the world’s attention. And while the present summit might lack the urgency of the 2009 G20 in London (just six months after the collapse of Lehman Brothers), President Xi Jinping is clearly aiming to use the hosting of the summit to reinvigorate world trade (and thereby, of course, China’s own economy). This in fact suits most of the participants, who also find their economies sluggish (France, Italy, Japan) or downright bad (Brazil, Russia, Argentina). But the UK presents a particular, special case: following Brexit, all seems to be up in the air, though one avowed goal of Brexiteers is increasing trade with the fast growing Asian nations. So Theresa May and Xi Jinping have much to discuss.
Although the British government under David Cameron and George Osborne declared a new golden age for Sino-British relations, the signs for May’s administration have not been so promising. One of the first decisions she took was to review the Hinkley Point nuclear power station, which was to be jointly funded by French and Chinese investment. However, subsequent statements by both May and Chancellor Philip Hammond have stressed Britain’s commitment to free trade. The idea seemed to be that, without the European Union’s inward-looking tariffs and regulations, the UK would be free once again to trade with the world, a global entrepôt like a larger Singapore.
So while May might be wary of welcoming foreign funding of strategically important infrastructure, a commitment to increased free trade would please Xi Jinping. The Chinese President’s opening remarks stressed economic reform, calling for four measures (as cited by the People’s Daily:
• Build an innovative world economy to generate new drivers of growth
• Build an open world economy to expand the scope of development
• Build an interconnected world economy to forge interactive synergy
• Build an inclusive world economy to strengthen the foundation for win-win outcomes
With free trade and revitalisation of the world economy very much on the agenda, we may therefore see a genuine synchronisation of Chinese and British interests. Could this be a real “golden age” of Sino-British relations?
G20 summits, with their need to accommodate very different economies, can tend to lead to nebulous pronouncements rather than drives for concerted action. Yet as the first major summit hosted by China and the first major summit attended by post-Brexit Britain, both countries will be looking to make a statement. The UK’s task is easier: simply, to demonstrate openness to trade and a commitment to deregulation. Xi’s task, as the host, is much larger: to develop a coherent, and concrete, plan for economic development, beyond platitudes and aspirations. What might he pledge for China? Reform of China’s moribund state owned enterprises, for one; renewed efforts on the One Belt, One Road plan; mutual development in the South China Sea; perhaps allowing greater foreign ownership of Chinese industries (it is difficult to complain about being denied this in Hinkley Point when such things are far from even being contemplated in China). Xi will need to be seen to reform the Chinese economy before he can cajole others to revive theirs.
No doubt most of this has already been considered, as the signing of the Paris Agreements obviously were. Highly choreographed and worked through ahead of the event, summits rarely develop their own momentum. They are usually expressions of the domestic anxieties and wishes of the participants, rather than coming together to make a coherent plan. Often it is the staging and “optics” rather than the policy outcomes that contribute to a summit being declared a success. But President Xi’s drive to revive world trade looks genuinely resolute. With China the engine of so much of the world’s economic growth over the past ten years, it now needs a perkier world economy to maintain growth. The UK, meanwhile, needs to show it can flourish outside of the EU. Both countries need each other more than ever. Now there may be a real golden era in the two nations’ relations.