Hong Kong remains a key gateway to China

Alan Yarrow says the city is a vital link in the UK's growing relationship with China, seen not least in its collaboration with London on the renminbi

PUBLISHED : Wednesday, 16 September, 2015, 9:00am
UPDATED : Wednesday, 16 September, 2015, 9:00am

Like London, Hong Kong is one of the world's foremost financial centres, and we share a rich history of collaboration. Renminbi is only the most recent manifestation of this; both our cities have developed into world-leading hubs of offshore renminbi business. London's position in the offshore renminbi market, in the words of the British Chancellor George Osborne, has been greatly strengthened as a result of collaboration with Hong Kong.

But we aren't the only beneficiaries. The development of the renminbi has demonstrated how the UK and Hong Kong can strengthen markets in surrounding economies as well.

Elsewhere, Hong Kong acts as a conduit into and out of China for both goods and capital. Last year, 8.5 per cent of the total trade between the UK and mainland China came through Hong Kong. Hundreds of UK firms operate in Hong Kong, using it as a springboard to the market of mainland China.

The fact is, China's development is intertwined with the rest of the world

But it's not all plain sailing. Recent volatility in Chinese stock markets has caused concern about economic growth locally and internationally. The fact is, China's development is intertwined with the rest of the world. China recognises this, as does the UK: that's why Britain was among the first European economies to embrace the China-led Asian Infrastructure Investment Bank this year and is enthusiastic about collaborating on China's "One Belt, One Road" initiative.

I know how important education, training and qualifications are for a successful economy. Investment in these areas is an investment in human capital. That is why I welcome Hong Kong's announcement of a series of initiatives to attract, recruit and retain talent.

During my visit this week, I will be interested to learn more about the HK$100 million to help subsidise training for people working in insurance and wealth management. I will also explore ways in which Hong Kong might benefit from our education, training and qualifications expertise.

The UK is one of the fastest growing G7 economies, and we want to remain a favoured destination for Chinese investment and businesses. The City of London is right at the centre of that aspiration.

The UK government has made China a priority market and is committed to a long-term economic relationship, in which Hong Kong will play a central role.

This year marks the beginning of a "golden era" in UK-China relations. Next month, President Xi Jinping will visit the UK, the first visit by a Chinese leader in a decade.

The ties between the UK and Hong Kong remain strong, but there is always more to do.

Alan Yarrow is the Lord Mayor of the City of London