Li Keqiang expected to discuss finance and trade deals on UK trip

Agreements likely during Li's London trip, according to ministry official

PUBLISHED : Friday, 13 June, 2014, 5:08am
UPDATED : Friday, 13 June, 2014, 5:08am

Premier Li Keqiang will discuss infrastructure, high-speed rail, nuclear and finance deals during a trip to Britain next week, as well as London's role as an offshore yuan trading hub, a senior government official said yesterday.

Li will meet British Prime Minister David Cameron at his London home on Tuesday, a reciprocal visit following the British leader's trip to China last year. Li will also go to Greece during the Monday to Saturday trip.

British finance minister George Osborne opened the door to further Chinese investment during a visit to Beijing last year.

He announced less stringent rules for Chinese banks operating in London in a push to make the British capital the main offshore hub for trading in renminbi and yuan-denominated bonds.

Osborne also paved the way for Chinese investors to take majority stakes in future British nuclear plants.

Speaking to reporters ahead of Li's visit, deputy commerce minister Gao Yan signalled further agreements would be signed.

"London has all along dedicated itself to becoming a renminbi trading centre. Relevant departments in China and Britain have had proactive investigations into this," she said.

"On this visit to Britain by Premier Li, I believe that there will be positive developments on this issue, including on financial cooperation," Gao said.

"We will fully make use of London's position as a financial centre to further develop China's finance industry."

The internationalisation of the yuan is one of China's most ambitious and hotly debated reform projects.

From less than one per cent in 2009, nearly a fifth of China's trade is now settled in yuan.

The objective is to increase the usage of the currency for trade, investment and as a reserve currency, while lowering forex risk for Chinese companies and reducing the country's exposure to US economic policy.

There could also be agreements on energy, infrastructure and high-speed rail, Gao said, praising Britain's open attitude towards foreign investment.