May’s visit yields US$1.3b in Chinese funds for British biotech and life sciences companies

China’s increasing zeal for improving biotechnology and medical services is music to the ears of the British government after two venture capital firms received 8 billion yuan (US$1.3 billion) in funding commitments from mainland investors during Prime Minister Theresa May’s three-day visit last week.

Future Planet Capital and Eight Great Technologies signed the memorandums of understanding with Chinese investment firms, which was witnessed by Liam Fox, Secretary of State for International Trade, which will invest the funds in Britain’s most innovative biotech, medicine and life sciences companies.

“There is a strong pipeline of deals emerging from British innovation and the renowned scientists backing Eight Great Technologies will increase that number,” Douglas Hansen-Luke, executive chairman of Future Planet, told the South China Morning Post. “These agreements are just the beginning of a long process to ensure that investments are made profitably.”

Shenzhen Qianhai Sunflower Financial Service and Jian Xin Tian Ran Investment Management, an offshoot of China Construction Bank, pledged to invest an initial 3 billion yuan in health care innovation and biotechnology, part of the 8 billion yuan funding commitment.

May’s visit to China heightened expectations of a stronger Sino-UK economic relationship. Beijing wants Britain to get on board with its Belt and Road Initiative – China’s ambitions of creating a new global economic order – while London, especially with Brexit looming, is scouting for Chinese investors and capital to buoy its growth.

“Investment deals of this kind are of mutual benefit to both countries,” said Shao Yu, chief economist of Orient Securities. “Chinese investors are grappling with difficulties in landing investment deals in key technologies in the United States and Britain sees China as an important funding source after Brexit.”