China advises companies to take “precautions” over Brexit

BEIJING - Chinese companies operating in Britain, especially in the financial sector or whose European headquarters are in Britain, need to take "precautions" due to uncertainly over Brexit, China's ambassador to London said.

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Prior Britain's vote to exit the European Union in June last year, China had not directly stated an opinion, viewing it as an internal matter and saying only that it wanted to see a strong and stable Europe.

Diplomatic sources, however, said that was coded support for the defeated "remain" camp, as the bloc - China's largest trading partner - will lose around a sixth of its economic output and an important supporter of free trade in the EU.

Britain's Prime Minister Theresa May Photo: Reuters

British Prime Minister Theresa May set out her vision for Brexit in a speech in mid-January, outlining plans to leave the EU single market in a clean break with the bloc.

Read also: British PM will open Brexit plan to MPs

In an interview with the official China Daily published on Tuesday, Chinese Ambassador Liu Xiaoming repeated China's position that Beijing respects Britain's choice and hopes for an early arrangement between Britain and the EU acceptable to both. "I believe, when there is a problem, there is always a solution," he said.

Britain has worked hard to attract Chinese investment, including in the financial sector, giving Chinese companies a London-based entry into the EU market. "Chinese companies in these sectors should take precautions," Liu said, without elaborating.

While China and Britain have a history of disputes over human rights and the future of Hong Kong, a former British colony that returned to Chinese rule in 1997, the export-reliant Asian giant values Britain as a strong advocate for free trade within the EU.

Ties have warmed in the past few years and economic links have multiplied, in what both countries refer to as a "golden age", though Britain upset China last year by putting on hold a nuclear project that it later approved.

Liu was upbeat about Sino-British ties. "There is huge potential to be tapped and bright prospects for co-operation."

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