It is a decade since I left Britain, having been Chinese ambassador here for more than five years, but I closely follow relations between our two countries.
Compared with 10 years ago, China-UK economic co-operation has not only grown in size but also expanded to more areas. This has generated broader benefits in both countries.
Take two-way investment as an example. When I was in Britain, Chinese investment in the UK was modest. The number of Chinese enterprises in Britain never passed 100. But, in 2010, British Chambers of Commerce statistics showed that 400-500 Chinese enterprises had recently established a presence in Britain. Such collaboration has made both sides winners.
In 2011, the MG Motors plant in Longbridge, with investment from China’s Shanghai Automotive Industry Corporation, resumed operation and unveiled two new cars. It had been 16 years since a new MG model rolled off the Longbridge lines. It revived a famous British brand and created more than 400 British jobs.
Another compelling example is China’s Huawei. In 2004, Huawei moved its European headquarters to Britain.
Over the years it has grown into a globally competitive brand. Not long ago Huawei announced its plan to invest another £1.3bn in the UK. This will create at least 700 jobs in the coming five years. So, as more and more Chinese companies have settled in Britain, they have not only made breakthroughs in their own business but also contributed to the growth of the British economy.
Britain led other European countries for many years in terms of investing in China. These investments yielded generous returns.
For example, late last year both Jaguar and Rover reached agreements on a joint venture with China’s Chery Automobile. Together they will invest more than £1bn to make British cars in China.
Britain’s favourite coffee shop, Costa, plans to triple the number of its shops in China to 500 by 2016. Costa believes that, with enhanced spending ability, the annual intake of coffee will grow rapidly. Costa estimates annual consumption will rise in China from the current 3 cups per head to something close to the world average of 240 cups.
Marked progress has been made in China-UK economic co-operation. Yet, given the sizes and strengths of our two economies, great potential remains untapped. This holds out great opportunities for us to step up our cooperation.
I recently read a British newspaper article entitled “Wake up. Our trade with China is pathetic”, which reported that a pathetic 0.4pc of Britain’s national output heads to China. The figures of Germany and Korea are respectively 2pc and 12pc.
It might be easier to figure out what these figures mean if we make another comparison. China has 1.3bn people, while the population of Ireland is little more than 4m. Yet Britain’s exports to China are only half of its exports to Ireland.
A Swiss friend of mine once joked: so long as every Chinese consumes one bar of Swiss chocolate every year, then the chocolate export target of Switzerland will be easily reached. I believe in some areas this case also applies to Britain.
The global economy is still in the doldrums. IMF statistics show that world economic growth in 2012 was merely 3.3pc. Developed economies grew by 1.3pc, while eurozone economies fell -0.4pc. Emerging economies also slowed down; the growth rate of the Chinese economy last year dropped to 7.8pc.
The troublesome economic situation requires closer cooperation between all countries.
China has not been immune from the international financial crisis, but prospects for the Chinese economy remain bright and its development can only boost growth of its partners.
The urbanisation rate in China has just passed 50pc. The increase of every percentage point means about 13m people will be better off. For Britain, this means a lot more Chinese shoppers in Oxford Street and Bond Street.
Some estimate that China’s urbanisation will generate $6.4 trillion (£4 trillion) of investment demand by 2016. Even modest forecasts say that in the coming five years China’s outbound investments will top $100bn and its imports will total more than $10 trillion.
Britain has placed much emphasis on infrastructure projects, such as high speed rail, telecommunications and nuclear power, which will cost billions. I am sure Chinese capital will make these projects easier.
London also intends to become one of the off-shore centres of RMB business, which requires close collaboration between our two countries.
It takes two to tango. Without sincerity and real effort from both sides, stronger China-UK cooperation would be impossible; it requires commitment not only from business, but also from governments.
Apart from the efforts of the business community, governments should also play a positive role. They should resist protectionist pressures, maintain openness in trade and investment and create an enabling environment for business cooperation.
Government endorsement and support from the top will boost economic cooperation and lead to big contracts. In 2011 when Premier Wen Jiabao visited the UK, the two sides signed contracts worth more than $4bn.
To translate the potential of China-UK cooperation into reality there must be greater mutual trust between the two countries in political, economic and other areas.
It also requires targeted efforts of the two governments to foster a sound, stable environment for cooperation. Then the business community will be sure about the returns on their investments and the public can be confident about the benefits of a warm relationship.
There will be both opportunities and challenges. We need to work together, seize the opportunities and address the challenges. Then we will have more examples of win-win.
To borrow an expression now popular in China, we want more “positive energy” from China-UK cooperation.