By Steven Ip – Editor in Chief
On Thursday 23 June 2016, we will go to the polls to vote in, arguably, the most important decision in our lives: whether Britain chooses to remain or leave the European Union. The EU referendum has thus far witnessed impassioned and well-articulated messages from both sides of the argument.
There have been countless reasons presented – for and against – for why people should vote in a particular fashion. But which way should British-Chinese people vote?
Nee Hao Magazine has endorsed the Remain side, as we firmly believe that the UK and EU are stronger when together.
Following Xi Jinping’s extremely successful state visit to the UK in October 2015, the two countries pledged to enter “a golden era” of relations. During the visit, the Chinese delegation was repeatedly asked of their stance on the Brexit question. President Xi was unequivocal in what he believed to be in Britain’s best interest:
“China hopes to see a prosperous Europe and a united EU, and hopes Britain, as an important member of the EU, can play an even more positive and constructive role in promoting the deepening development of China-EU ties.”
The Chinese government, alongside businesses, share the same belief that establishing economic links with Britain – much viewed as a stepping stone to closer relations with Europe – is vital to accessing the single market. Interestingly, trade between China and Britain has quadrupled since 2005. Between 2004-2014 average yearly inward investment from China totalled £168 million. Chinese conglomerates, through stationing headquarters in Britain, have created thousands of jobs in the UK. Sinopec, to name one business, employs 3,000 people.
Unlimited access to the single market (EU) is paramount in Chinese decisions on whether or not to make investments and business plans in the UK.
British and Chinese business communities have claimed that a vote to leave the EU would weaken the UK-China relationship.
The President of the CBI, Paul Drechsler, said: “Of course, countries outside the EU can, and do, sign trade deals, just as the UK would in the event of Brexit. But compared to what Europe can achieve, these deals aren’t up to scratch. The UK will be better able to stand toe-to-toe with China inside the EU than cutting its own deal outside of it.”
Andrew Mackenzie of CEO, also echoed warnings of repercussions between UK and China should the country decide to leave the EU: “Brexit will come back to bite… China takes Britain far more seriously because we are a major player in the EU.”
A rare privilege of EU membership is having free trade among 28 countries. In recent years, the EU has expanded free trade arrangements with an array of fast-developing countries, including South Korea, Jordan, Mexico and South Africa. At present, the union is negotiating an investment agreement with its second biggest trading partner, China. When the agreement is agreed upon and ratified, all countries, including the UK and China, will immensely benefit from the content. So, in other words, the UK enjoys the many benefits of these trade agreements through its membership of the EU.
Also, Chinese people have one of the highest entrepreneurial rates in the UK. Staying in would mean we get the best of both worlds of trading to the 500 million market of the EU, whilst actively negotiating and refining a good trade deal with China.
Most of European history has been plagued by numerous bloody wars. From this basic fact, proponents of the EU encourage people to not take for granted Europe’s longest period of peace since the end of the Second World War (1945). The EU has often been credited with encouraging cooperation and dialogue between all EU member states. Through frank exchanges and discussions misunderstanding in attitudes and actions, which in the past has resulted in major repercussions, can best be avoided. The UK can boast that it is a highly stable and healthy country. It has been claimed that some of the EU’s input has aided this much envied democratic state.
If hypothetically the UK were to leave the EU, what would be the picture? Well, no-one actually knows the answer. No country has actually ever left the single biggest market in the world. However, many predictions have been made.
Leave campaigners have quickly insisted that the UK, as the fifth largest economy in the world, could use its clout to sign a free trade agreement with China, similar to that of Iceland and Switzerland. To argue that reaching a free trade agreement with the second largest economy in the world is a straightforward task is folly. To exemplify, by scrutinising the trade pacts, which Iceland and Switzerland have with China, many cracks appear. In fact the two non-EU countries have very unfavourable deals with China. For instance, with the Swiss deal, Chinese exports can immediately enter Switzerland barrier-free, whilst at present Swiss exports are subject to tariffs, which will, however, fade out over time. Therefore, many believe that the best option for the UK would be for the whole of Europe, together as one, to use its leverage to reach a fairer economic deal with China.
In addition, should Britain’s EU membership cease what would be the period for the complete withdrawal and how damaging could this period be to the UK’s economy. Through countless deliberations and negotiations the actual leave date could take the UK an estimated 3 years to complete. In which time British markets could suffer unprecedentedly.
List of Chinese people supporting UK’s continued membership of the EU: Click here