Britain’s Friday vote to quit the European Union is seen to cause turmoil not only in Europe, but also to the rest of the world. But while many believe its effects on Asian economies in general may be benign, the region’s largest, China, may feel a greater impact in the long run.
Following the vote, Hua Chunying, spokesperson for the Chinese foreign ministry, expressed that China respected the choice of the British people.
“A prosperous Europe is in the interests of all parties and China is willing to keep co-operating with Britain and is fully confident in China-EU ties,” she said.
During his visit to the United Kingdom last year. Chinese president Xi Jinping expressed his hopes of having Britain to remain in the European Union, Telegraph reported.
“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,” said a paraphrased statement from Xi released by China’s foreign ministry.
Over the years, Britain has played a significant role in promoting Chinese relations with the union, which has become China’s largest trading partner, according to South China Morning Post. This is the reason why many analysts believe that Britain’s exit from the European Union will lead to difficult trade and investment agreements between China and the bloc.
The completion of an E.U.-China trade deal and China’s aim to gain Market Economy Status—a status that would protect the country from certain E.U. trade tariffs, may also be put in danger.
He Weiwen, co-director of the China-US-EU Study Centre under the China’s Ministry of Commerce said that it would be necessary now to boost ties with the rest of European Union countries.
“The European Union [without the presence of Britain] is likely to adopt a more protectionist approach when dealing with China. [The cooperation between China and the EU] may become more difficult,” he said. “For Chinese companies which have set up headquarters or branches in the UK, they may not be able to enjoy tariff-free access to the wider European market after Britain leave the EU.”
Some experts believe, however, that a fractured EU may be beneficial to China’s further global economic rise in the long run.
Bloomberg points out that Friday’s vote may create more opportunities for China to leverage itself in the world stage both economically and politically, citing the bloc having weaker stance against the world second largest economy’s growing assertiveness.
Amid the turmoil that sent the Chinese yuan to its lowest rate against the dollar in more than five years, Chinese state-run media has generally stayed away from the widely covered global news. Major headlines covered President Xi’s visits to Serbia, Poland and Uzbekistan instead.