Sir Keir Starmer is in China today for the first visit by a British prime minister to the Asian superpower since 2018.
Also in today’s trade news, the value of gold is climbing to record highs with the US dollar sliding amid ongoing geopolitical uncertainty, while an EU IT system issue is causing a pile-up of fish at European ports.
‘China matters for the UK’
British prime minister Starmer is currently in China alongside a delegation of 60 representatives from British business, sport and culture.
The trip is laden with geopolitical intrigue, coming as it does in the aftermath of Donald Trump’s recent threats to impose tariffs on European nations including the UK over a dispute over control of Greenland.
Though these threats have been withdrawn, Starmer’s visit will likely be scrutinised by the White House, as well as political opponents in the UK, with Conservative leader Kemi Badenoch writing an op-ed in the Telegraph today decrying the trip.
The visit also comes against the backdrop of a Chinese defence minister calling for closer ties with Russia, and Starmer’s team is using disposable ‘burner phones’ during the trip amid security concerns.
A government statement has asserted that the UK relationship with China warrants the trip, with the superpower representing “the world’s second largest economy, a crucial player in global supply chains” and “the UK’s third largest partner” which supports 370,000 British jobs.
“For years, our approach to China has been dogged by inconsistency – blowing hot and cold, from Golden Age to Ice Age. But like it or not, China matters for the UK,” said Starmer.
The government also stated it will “not trade economic cooperation for our national security”.
What could the China trip lead to?
According to Politico, the trip could result in a flurry of announcements of deals, further dialogues and memoranda of understanding. These could include joint initiatives on health, life and climate sciences.
Indeed, such work would come as the number of Chinese students at British universities continues to grow, with FT analysis published yesterday showing that two in five overseas students at Russel Group institutions were from China last year.
“Officials are also working on the mutual recognition of professional qualifications and visa-free travel for short stays, while firms have been pushing for more expansive banking and insurance licences for British companies operating in China,” Politico reports.
“The UK is meanwhile likely to try to persuade Beijing to lower import tariffs on Scotch whisky, which doubled in February 2025.”
Despite efforts to strengthen UK-China trade ties, the business and trade secretary, Peter Kyle, published a statement yesterday extending the application of anti-dumping measures on welded tubes and pipes originating from China, as well Belarus.
Kyle has travelled to China alongside the prime minister.
The Trump effect: Gold up, dollar down
Gold continues to race to record highs in value. A safe haven during times of economic uncertainty, the rise in value of the precious metal shouldn’t be too surprising given the volatility seen last week in US-European relations.
The dollar, previously another safe haven for investors, is now weakening, with concern over US policies leading to a sharp sell-off this week.
The currency has fallen 1.5% compared to other major currencies, with a particularly steep sell-off after Trump declared yesterday that he wasn’t concerned by this decline, the FT reports.
EU divided on fate of US trade deal
The European Parliament has postponed a decision on whether to unfreeze the EU-US trade deal.
The agreement, which reduces the ‘reciprocal’ tariffs introduced by Trump on ‘Liberation Day’ last year in exchange for European investment and rule changes to support US exports, was frozen last week in response to Trump’s tariff threats. What happens next for the deal is uncertain, with lawmakers failing to agree on whether to unfreeze it during a vote on Monday.
Socialist, Renew and Green parliamentarians are calling for the bloc to review Trump’s claimed ‘framework’ for future arrangements over Greenland in detail before unfreezing the trade deal. Centre-right and right wing groups are calling for the deal to continue, according to Politico.
Fishy business – IT system causes pile-up
A glitch with a new EU IT system for imports has caused a pile-up of fish at European ports. CATCH was introduced on 10 January and requires importers to manually input a wide range of information from certificates provided by boats to ensure the fish are caught legally.
One major importer told the FT that CATCH had only cleared a half of its shipments, with containers of frozen and tinned fish now stuck in Rotterdam.
“We keep getting inexplicable error messages, server errors,” an employee said. “Not all country Zip codes are in the system... and not all fish species are in the system so we cannot enter them.’’
The information is submitted manually and takes several hours to enter, with catch certificates also needing to be uploaded.
“The upload limit is 2MB. We have 80-page catch certificates. They are much bigger than 2MB.”
Other trade news today
- The Institute for Government has said that a “stronger, more economically capable No. 10” is needed to boost UK growth in a new report published today
- A new Transport Committee report is calling on government to improve opportunities and skills in the transport manufacturing sector, advocating for an easing of constraints on access to levy funding for apprenticeships
- EU tech chief Henna Virkkunen has called out Europe’s overdependence on foreign tech, Politico reports
Yesterday in trade
- The EU and India announced an ‘historic’ new trade deal
- The UK Office of Financial Sanctions Implementation said it had issued a fine of £175,000 on the Bank of Scotland for breaches of Russia sanctions
- Trump announced plans to raise 25% tariffs on South Korea
You can read about yesterday in trade here.
