Pragmatism should lead to improvement in Sino-British relations

Following the resignation of Boris Johnson as head of the Conservative Party, the next prime minister of Britain should prepare for inheriting a protracted economic downturn brought about by the COVID-19 pandemic and the current cost-of-living crisis, as well as a looming recession and the longterm economic degeneration activated by a hard Brexit. Brendan O’Leary, an expert on UK politics, argues that the question now is whether any of Johnson’s potential successors will have the courage to tell the public that Brexit is, and will remain, a slow-moving catastrophe.

Diplomatically, a weakened UK, which has become more dependent on the US post-Brexit, needs to strike a balance between the American push for strengthening a US-dominated strategic partnership with its junior partner, and the pull of tremendous economic opportunities offered by China in terms of trade and investment. Any attempts by the next prime minister to move closer to China will positively affect British policy toward Hong Kong.

When then-British prime minister Theresa May negotiated for a Brexit deal, she pinned her hope on a softBrexit proposal known as the “Chequers deal”. Relying on the moderate Chequers deal, she supported the maintenance of close economic links between Britain and the EU. But the proposal was rejected by hardline supporters of the “leave” camp within her own party who opposed keeping so many EU laws and regulations in place. They argued that the soft-Brexit deal would enable the EU to continue to intrude into every aspect of national life.

In late 2019, Johnson replaced May as the new prime minister. He tragically pushed the British economy to the edge of a long-term decline by locking the UK into a hard exit from the EU. A “hard Brexit” means a complete exit from the EU. As a result, Britain is no longer a part of the EU’s single market and customs union. The foremost impact is that British goods that flow into other EU countries will attract a 10 percent tax. Future trading agreements with the EU will be conducted on the basis of a free trade agreement.

There has been an overwhelming agreement among economists that leaving the EU would adversely affect the British economy in the medium and long terms. In October 2021, the UK government’s Office of Budget Responsibility calculated that Brexit would cost 4 percent of GDP annually over the long term, i.e., around 32 billion pounds ($38.9 billion). In fact, many companies have shifted assets, offices or operations out of Britain since the Brexit referendum. It may take a couple of years for Britain to repair its political relations with the EU.

According to economist Paul Krugman, the assertion by the “leave” camp that leaving the single market and customs union might increase UK exports to the rest of the world is wrong. He estimated the costs of Brexit might be around 2 percent of GDP. To cite an example, Brexit supporters wrongfully exaggerate the trading opportunities offered by Commonwealth partners. Post-Brexit, Britain is actively pursuing free trade agreements with Commonwealth partners. But the Commonwealth just accounted for 9.1 percent of the UK’s total trade in 2019. Furthermore, economists have highlighted the adverse effects of Brexit on London’s status as an international financial center.

There are also deepening concerns about the deteriorating Sino-British relations under the Johnson administration. From the UK’s interference in Hong Kong affairs and the banning of Huawei and CGTN to its Xinjiangrelated sanctions and recent accusations of a “Uygur genocide”, many British observers get the impression that the sour Sino-British relations have reached a point of no return. Even Rishi Sunak, who is tipped to become the next prime minister, has focused on the national security “threat” posed by China in the Tory leadership debate.

But whoever comes to power will, sooner or later, adopt interest-based pragmatism, flexibility and an adherence to liberalism, free trade and multilateralism as the guiding principles of British foreign policy toward China. In July 2016, then-chancellor of the exchequer Philip Hammond confirmed that Britain would like to cement its trading relationship with China in the postBrexit era. It is worth noting that Johnson has also signaled London’s resolve to continue engaging with Beijing in spite of Britain’s seemingly tense relationship with China. In a recent speech, former prime minister Tony Blair has raised his opposition to decoupling with China.

In actual fact, every country puts its own national interests at the center of its diplomacy. In spite of its special relationship with the US, Britain has found itself buried in controversy by being the first major Western country to recognize the People’s Republic of China in 1950. Another controversial move was the decision by Britain to ignore American objections and sign up to the China-led Asian Infrastructure Investment Bank. Britain’s early enthusiasm for China’s Belt and Road Initiative, its assistance in promoting the internationalization of the renminbi, and its past role within the EU in helping curb anti-Beijing protectionism by other EU member states have not escaped the attention of some Chinese scholars specializing in British politics.

In addition to the above controversial moves by Britain to engage with the main competitor of its senior partner, the Suez crisis of 1956 reminds us that there is no eternal unity of interest between the US and Britain. The Five Eyes partnership, the Quadrilateral Security Dialogue (Quad) platform and the AUKUS agreement are rooted in a binary view shaped by the US. Unlike the US, Britain may be more interested in promoting trade and exploring investment opportunities in Asia. Partly because of different perceptions of external threats, and partly because of Britain’s endorsement of multilateralism and free trade without political constraints, Britain’s special relationship with the US may not be permanent.

There is no little irony in the fact that both China and Britain are advocates of globalization, multilateralism, and free trade without political constraints. The economic relationships between these two countries are basically complementary. As important as its special relationship with the US is, the huge economic benefits offered by China are likely to have big influence on whether Britain should be optimistic or pessimistic about its economic future and its future role in the postBrexit world.

Hopefully, an improvement in SinoBritish relations will also improve relations between Britain and the Hong Kong Special Administrative Region. If Britain looks at its interference in Hong Kong’s affairs through the lens of its increasingly close economic ties with China, and if Britain still remembers the advice of the late Sir Alan Donald (the former British ambassador to China from 1988 to 1991), it will be more aware of the risks of interference. In 1993, Donald said, “When one compares the strategic goals of China and the strategic interests of Hong Kong and its people, the continuing search for common ground is more likely to produce the right result than concentrating on difference in political philosophy.” It is worth noting that Donald was very critical of the democratic reforms introduced by Chris Patten in Hong Kong in an attempt to interfere in Hong Kong politics in the post-handover era.