LONDON — Victory is finally in sight for the Bank of England. But rate cuts aren’t. It’s taken Britain’s central bank longer to bring inflation under control than any of its peers on the global stage, but on Thursday economists expect forecasts to show that inflation in the U.K. will return to the government’s 2 percent target within the next two years, having overshot it for almost all of the last four. The pound surged to its highest level against the dollar in five years last month, as global confidence in the anchor of the world’s financial system appeared to fray due to the news flow out of the U.S. But there will be little else to set the pulse racing: Financial market participants are almost unanimous in expecting no change in the Bank rate from its current 3.75 percent. Even the extraordinary events of January, which saw the U.S. seize Venezuelan leader Nicolas Maduro and U.S. President Donald Trump threaten military force against his NATO allies over Greenland, seem unlikely to induce a shift in the Bank’s communication about the U.K.’s economic outlook. Extrapolating how these seismic events will translate into the U.K. economy has been hard. One of the more hawkish members of the Bank’s Monetary Policy Committee, Megan Greene, argued in a speech last month that while a stronger pound should help keep the cost of imports down, it could easily be offset by other factors, especially if the U.S. Federal Reserve were to be pressured by the White House into cutting U.S. interest rates more aggressively. Greene argued the MPC should focus on what is in its power to control. Here, the Bank is facing a familiar conundrum: growth is sluggish and unemployment is trending higher, but inflation is coming down — even if painfully slowly — and most business surveys suggest wage growth will continue to outstrip what is justified by productivity. Headline inflation ticked up again in December to 3.4 percent, still far above the 2 percent target. The latest data suggest that the economy is still more or less ticking along, growing at an annual rate of 1.4 percent in the three months through November. STILL ‘GRADUAL AND CAUTIOUS’ The narrow vote by the MPC to cut the Bank rate to 3.75 percent from 4 percent at its last meeting in December — and the unwavering message from the Bank that it will take a “gradual and cautious” approach to easing policy — means the committee will stay put on Thursday, according to Deutsche Bank economist Sanjay Raja. UBS economist Anna Titareva, meanwhile, reckons the vote will be split, with both Governor Andrew Bailey and Deputy Governor Sarah Breeden capable of voting again for a cut alongside Alan Taylor and Swati Dhingra, the two external members most concerned about the risks of a slowdown and an accompanying rise in joblessness. But that scenario would still leave Bailey in the minority against the remaining five of nine members in the committee. Most analysts still expect the Bank to cut interest rates twice this year. Inflation is set to fall from April as Chancellor Rachel Reeves’ decision to strip green levies off energy bills causes a drop in final prices for electricity. Deutsche’s Raja expects cuts in March and again in June, but says rates are unlikely to fall any further after that.

LONDON — The European Commission is looking into whether former British politician Peter Mandelson broke EU rules over his contact with sex offender Jeffrey Epstein. Even though the U.K. left the EU six years ago, Mandelson remains bound by obligations that he signed up to during his time as a commissioner, from 2004 to 2008. Newly released files suggest Mandelson in 2010, while he was a senior minister in the U.K. government, may have given Epstein advance notice of a €500 billion bailout to save the euro at the height of the spiraling Greek debt crisis. European finance ministers agreed the deal overnight amid fears that the failing Greek economy could trigger a wider crisis across the eurozone. According to the files released in the U.S., Epstein, who was a financier, sent Mandelson an email the previous night saying: “Sources tell me 500 b euro bailout , almost complete.” Mandelson replied: “Sd be announced tonight.” The cabinet minister then said he was just leaving 10 Downing Street and “will call.” The British government decided not to take part in the bailout for the euro but was part of the talks that paved the way for the emergency measure, so would have known how events were progressing. On Tuesday, Balazs Ujvari, a spokesperson for the Commission said: “We have rules in place emanating from the treaty and the code of conduct that commissioners, including former commissioners, have to follow.” When there is an indication that the rules may not have been followed, the Commission looks into any potential breaches, he said. “We will be assessing if, in light of these newly available documents, there might be breaches of the respective rules with regard to Peter Mandelson.” Mandelson did not immediately respond to a request for comment. He has previously said he was wrong to have continued his association with Epstein and apologized “unequivocally” to Epstein’s victims.

SHANGHAI — As Keir Starmer arrived for the first visit by a British prime minister to China for eight years, he stood next to a TV game show-style wheel of fortune. The arrow pointed at “rise high,” next to “get rich immediately” and “everything will go smoothly.” Not one option on the wheel was negative. Sadly for the U.K. prime minister, reality does not match the wheel — but he gave it a good go. After an almost decade-long British chill toward China, Starmer reveled in three hours of talks and lunch with Chinese President Xi Jinping on Thursday, where he called for a “more sophisticated” relationship and won effusive praise in return. Britain boasted it had secured visa-free travel for British citizens to China for up to 30 days and a cut in Chinese tariffs on Scotch whisky. Xi even said the warming would help “world peace.” His wins so far (many details of which remain vague) are only a tiny sliver of the range of opportunities he claimed Chinese engagement could bring — and do not even touch on the controversies, given Beijing’s record on aggressive trade practices, human rights, espionage, cyber sabotage and transnational repression. But the vibes on the ground are clear — Starmer is loving it, and wants to go much further. POLITICO picks out five takeaways from following the entourage. 1) THERE’S NO TURNING BACK NOW Britain is now rolling inevitably toward greater engagement in a way that will be hard to reverse. Labour’s warming to China has been in train since the party was in opposition, inspired by the U.S. Democrats and Australian Labor, and the lead-up to this meeting took more than a year. No. 10 has bought into China’s reliance on protocol and iterative engagement. Xi is said to have been significantly warmer toward Starmer this week (their second meeting) than the first time they met at the G20 in Rome. Officials say it takes a long time to warm him up. There is no doubt China’s readout of the meeting was deliberately friendlier to Labour than the Conservatives. One person on the last leader-level visit to China, by Conservative PM Theresa May in 2018, recalled that the meetings were “intellectually grueling” because Xi used consecutive translation, speaking for long periods before May could reply. This time officials say he used simultaneous translation. It will not end here — because Starmer can’t afford for it to. Many of the dozen or so deals announced this week are only commitments to investigate options for future cooperation, so Britain will need to now push them into reality, with an array of dialogues planned in the future along with a visit by Foreign Secretary Yvette Cooper. As Business Secretary Peter Kyle told a Thursday night reception at the British Embassy: “This trip is just the start.” 2) BRITAIN’S STILL ON THE EASY WINS Deals on whisky tariffs and visa-free travel were top of the No. 10 list but — as standalone wins without national security implications — they were the lowest-hanging fruit. The two sides agreed to explore whether to enter negotiations towards a bilateral services agreement, which would make it easier for lawyers and accountants to use their professional qualifications across the two countries. In return, investment decisions in China were announced by firms including AstraZeneca and Octopus Energy. But many of the other deals are only the start of a dialogue. One U.K. official called them “jam tomorrow deals.” And Luke de Pulford, of the Inter-Parliamentary Alliance on China campaign group, argued that despite Britain having a slight trade surplus in services “it’s tiny compared to the whole.” He added: “This trip to China seems to be based upon the notion that China is part of the solution to our economic woes. It’s not rooted in any evidence. China hasn’t done foreign direct investment in any serious way since 2017. It’s dropped off a cliff.” Then there are areas — particularly wind farms — where officials are more edgy and which weren’t discussed by Starmer and Xi. One industry figure dismissed concerns that China could install “kill switches” in key infrastructure — shutting down a wind turbine would be the equivalent of a windless day — but concerns are real. A second U.K. official said Britain had effectively categorized areas of the economy into three buckets — “slam dunks” to engage with China, “slam dunks” to block China, and everything in between. “We’ve been really clear [with China] about which sectors are accessible,” they said, which had helped smooth the path. Then there are the litany of non-trade areas where China will be reluctant to engage: being challenged on Xi’s relationship with Russian President Vladimir Putin, the treatment of the Uyghur people and democracy campaigner Jimmy Lai. Britain is still awaiting approval of a major revamp of its embassy in Beijing, which will be expensive with U.K. contractors, materials and tech, all security-cleared, being brought in. 3) STARMER AND HIS TEAM WERE GENUINELY LOVING IT After such a build-up and so much controversy, Starmer has … been having a great time. The prime minister has struggled to peel the smile off his face and told business delegates they were “making history.” Privately, several people around him enthused about the novelty of it all (many have never visited China and Starmer has not done so since before he went into politics). One said they were looking forward to seeing how Xi operates: “He’s very enigmatic.” Briefing journalists in a small ante-room in the Forbidden City, Starmer enthused about Xi’s love of football and Shakespeare. And talking to business leaders, he repeated the president’s line about blind men finding an elephant: “One touches the leg and thinks it’s a pillow, another feels the belly and thinks it’s a wall. Too often this reflects how China is seen.” So into the spirit was Starmer that he even ticked off Kyle for not bowing deeply enough. At the signing ceremony for a string of business deals, Kyle had seen his counterpart bend halfway to the floor — and responded with a polite nod of the head. The vibes were energetic. Britain’s new ambassador to Beijing, Peter Wilson, flitted around ceaselessly and sat along from Starmer in seat 1E. The PM’s No. 10 business adviser, Varun Chandra, jumped from CEO to CEO at the British embassy. The whole delegation was on burner phones and laptops (even leaving Apple Watches at home) but the security fears soon faded to the background for U.K. officials. CEOs on the trip queued up to tell journalists that Starmer was making the right choice. “We risk a technological gulf if we don’t engage,” said one. There is one problem. Carry on like this, and Starmer will struggle to maintain his line that he is not re-entering a “golden era” — like the one controversially pushed by the Tories under David Cameron in the early 2010s — after all. 4) BUSINESS WAS EVERYTHING The trip was a tale of two groups of CEOs. The creatives and arts bosses gave the stardust and human connection that such a controversial visit needed — but business investment was the meat. In his opening speech Starmer name-checked three people: Business Secretary Peter Kyle, City Minister Lucy Rigby and No. 10 business adviser Varun Chandra. It even came through in the seating plan on the chartered British Airways plane, with financial services CEOs in the pricey seats while creatives were in economy — although this was because they were all paying their own way. Everyone knew the bargain. One arts CEO confessed that, while their industry made money too, they knew they were not the uppermost priority. Starmer’s aides insist they are delighted with what they managed to bag from Xi on Thursday, and believe it is at the top end of the expectations they had on the way out. But that will mean the focus back home on the final “big number” of investment that No. 10 produces — and the questions about whether it is worth all the political energy — are even more acute. 5) STARMER’S STILL WALKING A TIGHTROPE British CEOs were taken to see a collection of priceless Ming vases. It was a good metaphor. Starmer and the No. 10 operation were more reticent even than usual on Thursday, refusing to give on-the-record comment about several basic details of what he raised in his meeting with Xi. Journalists were told that he raised the case of democracy campaigner Jimmy Lai, but not whether he called directly for his release. The readout of the meeting from Communist China was more extensive (and poetic) than that from No. 10. Likewise, journalists were given no advance heads-up of deals on tariffs and visas, even in the few hours between the bilateral and the announcements, while the details and protocol were nailed down. There was good reason for the reticence. Not only was Starmer cautious not to offend his hosts; he also did not want to enrage U.S. President Donald Trump, who threatened Canada with new tariffs after PM Mark Carney’s visit to Beijing this month. Even with No. 10 briefing the U.S. on the trip’s objectives beforehand, and Starmer giving a pre-flight interview saying he wouldn’t choose between Xi and Trump, the president called Britain’s engagement “very dangerous” on Friday. And then there’s the EU. The longer Trump’s provocations go on, the more some of Starmer’s more Europhile allies will want him to side not with the U.S. or China, but Brussels. “There’s this huge blind spot in the middle of Europe,” complained one European diplomat. “The U.K. had the advantage of being the Trump whisperer, but that’s gone now.” Starmer leaves China hoping he can whisper to Trump, Xi and Ursula von der Leyen all at the same time.

LONDON — It’s a far cry from the ice age of U.K.-China relations that characterized Rishi Sunak’s leadership — and it’s not exactly David Cameron’s “golden era,” either.  As U.K. Prime Minister Keir Starmer embarks on his Chinese charm offensive against a turbulent economic backdrop, he has opted for a softly-softly approach in a bid to warm up one of Britain’s most important trading partners — a marked departure from his Tory predecessors. With the specter of U.S. President Donald Trump looming over the visit — not to mention national security concerns back home — Starmer’s cautious optimism is hardly surprising.  Despite reservations from China skeptics, Starmer’s trip — the first such visit by a British prime minister since 2018 — was peppered with warm words and a smattering of deals, some more consequential than others. Britain’s haul from the trip may be modest, but it’s just the beginning, Business and Trade Secretary Peter Kyle — who joined Starmer on the trip — told a traveling pack of reporters in Beijing. “This visit is a springboard,” the minister said. “This is not the last moment, it is a springboard into a future with far more action to come.” STEP-BY-STEP On the ground in Beijing, British officials gave the impression that the prime minister was focused on getting as many uncontroversial wins over the line as possible, in a bid to thaw relations with China. That’s not to say Starmer and his team don’t have a few tangible wins to write home about. Headline announcements include a commitment from China to allow visa-free travel for British tourists and business travelers, enabling visits of up to 30 days without the need for documents.   The provisions are similar to those extended to 50 other countries including France, Germany, Italy, Australia and Japan. The timings of the visa change have not yet been set out publicly, but one official — who, like others cited in this piece, was granted anonymity to speak freely — said they were aiming to get it nailed down in coming months. “From a business standpoint, it will reduce a lot of friction,” said a British business representative, adding it will make it easier for U.K. firms to explore opportunities and form partnerships. “China is very complicated. You have to be on the ground to really assess opportunities,” they said, adding visa-free travel “will make things a lot easier.” The commitment to visa-free travel forms part of a wider services package aimed at driving  collaboration for businesses in healthcare, financial and professional services, legal services, education and skills — areas where British firms often face regulatory or administrative hurdles.  The countries have also agreed to conduct a “feasibility study” to explore whether to enter negotiations towards a bilateral services agreement. If it goes ahead, this would establish clear and legally binding rules for U.K. firms doing business in China. Once again, the timeframe is vague. David Taylor, head of policy at the Asia House think tank in London, said “Xi’s language has been warmer and more expansive, signaling interest in stabilizing the relationship, but the substance on offer so far remains tightly defined.” “Beyond the immediate announcements, progress — particularly on services and professional access — will be harder and slower if it happens at all,” he added. WHISKY TARIFF RELIEF Another victory talked up by the British government is a plan for China to slash Scotch whisky tariffs by half, from 10 percent to 5 percent.  However, some may question the scale of the commitment, which effectively restores the rate that was in place one year ago, ahead of a doubling of the rate for whisky and brandy in February 2025. The two sides have not yet set out a timeframe for the reduction of tariffs.  Speaking to POLITICO ahead of Starmer’s trip, a senior business representative said the whisky and brandy issue had become “China leverage” in talks leading up to the visit. However, they argued that even a removal of the tariff was “not going to solve the main issue for British whisky companies in China and everywhere, which is that people aren’t buying and drinking whisky.” CHINA INVESTMENT WIN Meanwhile, China can boast a significant win in the form of a $15 billion investment in medicines manufacturing and research and development from British pharmaceutical giant AstraZeneca.  ING Bank’s global healthcare lead Stephen Farelly said that increasing investment into China “makes good business sense,” given the country is “now becoming a force in biopharma.” However, it “does shine a light on the isolation of Europe and the U.K. more generally, where there is a structural decline in investment and R&D.” AstraZeneca recently paused a £200 million investment at a Cambridge research site in September last year, which was due to create 1,000 jobs.  Britain recently increased the amount the NHS pays for branded, pharmaceutical drugs, following heavy industry lobbying and following trade negotiations with the Trump administration — all in the hopes of attracting new investment into the struggling sector.  Shadow Trade Secretary Andrew Griffith was blunt in his assessment. “AstraZeneca’s a great British company but under this government it’s investing everywhere in the world other than its U.K. home. When we are losing investment to communist China, alarm bells should be ringing in No 10 Downing Street.” Conspicuously absent from Starmer’s haul was any mention of net zero infrastructure imports, like solar panels, a reflection of rising concerns about China’s grip on Britain’s critical infrastructure. XI RETURNS So what next? As Starmer prepares to fly back home, attention has already turned to his next encounter with the Chinese leader.  On Thursday, Britain opened the door to an inward visit by Xi Jinping, with Downing Street repeatedly declining to rule out the prospect of welcoming him in future. Asked about the prospect of an inward visit — which would be the first for 11 years — Starmer’s official spokesperson told reporters: “I think the prime minister has been clear that a reset relationship with China, that it’s no longer in an ice age, is beneficial to British people and British business.” As Starmer’s trip draws to a close, one thing is certain: there is more to come. “This isn’t a question of a one-and-done summit with China,” Starmer’s spokesperson added. “It is a resetting of a relationship that has been on ice for eight years.”

BEIJING — Britain on Thursday opened the door to an inward visit by Xi Jinping after the Chinese president hailed a thawing of relations between the two nations. Downing Street repeatedly declined to rule out the prospect of welcoming Xi in future after saying that Prime Minister Keir Starmer’s current visit to China would not be a “one-and-done summit.” Asked about the prospect of an inward visit — which would be the first for 11 years — Starmer’s official spokesperson told reporters: “I think the prime minister has been clear that a reset relationship with China, that it’s no longer in an ice age, is beneficial to British people and British business. “I’m not going to get ahead of future engagements. We’ll set those out in the normal way.” Xi paid a full state visit to the U.K. in 2015 and visited a traditional pub with then-Prime Minister David Cameron, during what is now seen as a “golden era” of British-Chinese relations. Critics of China’s stance on human rights and espionage see the trip as one of the worst foreign policy misjudgments of the Cameron era. Kemi Badenoch, leader of the opposition Conservative Party, said: “We should not roll out the red carpet for a state that conducts daily espionage in our country, flouts international trading rules and aids Putin in his senseless war on Ukraine. We need a dialogue with China, we do not need to kowtow to them.” Any state visit invitation would be in the name of King Charles III and be issued by Buckingham Palace. There is no suggestion that a full state visit is being considered at present. Xi did not leave mainland China for more than two years during the Covid-19 pandemic. Starmer and Xi met Thursday in Beijing’s Great Hall of the People and the two nations agreed to look at the “feasibility” of a partnership in the services sector. Britain said it had signed an agreement for China to waive visa rules for British citizens visiting for less than 30 days for business or tourism, bringing the U.K. into line with nations including France, Germany, Italy, Australia and Japan. The two nations also promised to co-operate on conformity assessments, exports, sports, tackling organized crime, vocational training and food safety, though further details were not immediately available. Starmer also hailed “really good progress” on lowering Chinese whisky tariffs. One official familiar with the talks stressed that Starmer had also raised more difficult issues including the ongoing detention of British-Hong Kong democracy campaigner Jimmy Lai, and China’s position on the war in Ukraine — but declined to be drawn on the specifics of the pair’s conversation. The talks steered clear of more difficult topics such as wind farm technology, where critics fear co-operation would leave Britain vulnerable to Chinese influence. Asked if Starmer had come back empty handed, his spokesperson said: “I don’t accept that at all. I think this is a historic trip where you’ve seen for the first time in eight years a PM set foot on Chinese soil, have a meeting at the highest level with the president of the second largest economy in the world. “You should also note that this isn’t a question of a one-and-done summit with China. It is a resetting of a relationship that has been on ice for eight years.”

The U.K. and China have announced a new services partnership to support British businesses operating in China, including through visa-free travel for short stays. The partnership will see Beijing relax its visa rules for British citizens, adding the U.K. to its visa-free list of countries. This will enable visits of up to 30 days for business and tourism without the need for a visa. The timings of the visa change have not yet been set out. The partnership focuses on better collaboration for businesses in healthcare, financial and professional services, legal services, education and skills — areas where British firms often face regulatory or administrative hurdles.  Britain and China have also agreed to conduct a “feasibility study” to explore whether to enter negotiations towards a bilateral services agreement. If it proceeds, this would establish clear and legally binding rules for U.K. firms doing business in China. Prime Minister Keir Starmer said: “As one of the world’s economic powerhouses, businesses have been crying out for ways to grow their footprints in China. “We’ll make it easier for them to do so – including via relaxed visa rules for short-term travel — supporting them to expand abroad, all while boosting growth and jobs at home.” The U.K. and China have also signed pacts covering co-operation on conformity assessments for exports from the U.K. to China, food safety, animal, and plant quarantine health and the work the UK-China Joint Economic and Trade Commission. The two sides aren’t planning to publish the full texts of the pacts.

BEIJING — U.K. Prime Minister Keir Starmer has hailed “really good progress” on Chinese whisky tariffs and visa-free travel after a lengthy meeting with Chinese President Xi Jinping. Starmer dubbed the one hour and 20 minute sit-down with Xi as “a very good productive session with real, concrete outcomes, [which was] a real strengthening of the relationship.” Speaking to reporters after the meeting, he said: “We made some really good progress on tariffs for whisky, on visa free travel to China and on information exchange.” The news will be welcomed by Scotch whisky exporters, who have been squeezed by U.S. President Donald Trump’s 10 percent baseline tariffs on imported U.K. goods.  Currently, Scotch whisky exports face 10 percent duties in China, after the country doubled its import tariffs on brandy and whisky in February 2025, removing its provisional 5 percent rate. Exports to China fell by 31 percent last year, sliding from China’s fifth-largest export market to its tenth.  “We’ve agreed that on tariffs for whisky, we’re looking at how they’re to be reduced, what the timeframe is,” said Starmer. The two sides also made progress on visa-free travel to China for short stays — which would allow British citizens to visit for tourism, business conferences, family visits, and short exchange activities without requiring a visa. Britain is currently not among the European countries granted visa-free access to China, a list that includes France, Germany, Italy, Spain, and Switzerland. Starmer said the two sides are now looking at “how far, how much, and when that can start.” China issued its own readout via state news agency Xinhua, where it discussed expanded cooperation in “education, healthcare, finance, and services, and conduct joint research and industrial transformation in fields such as artificial intelligence, bioscience, new energy, and low-carbon technologies to achieve common development and prosperity.” The Chinese statement said both sides should “strengthen people-to-people exchanges and further facilitate personnel exchanges,” adding that China “is willing to actively consider implementing unilateral visa-free entry for the U.K.” Starmer and Chinese Premier Li Qiang are due to sign memorandums of understanding covering cooperation in a number of areas at a signing ceremony on Thursday morning U.K. time. Starmer and Li will also sign a border security pact to enlist Beijing’s help in choking off the supply of small boat engines and equipment used by criminal gangs to facilitate Channel crossings POLITICO first reported earlier this month that the U.K. was pushing to secure visa-free travel and lower whisky tariffs. This developing story is being updated.

LONDON — U.K. Prime Minister Keir Starmer is braced for a meeting with Chinese leader Xi Jinping — and there’ll be more than a few elephants in the room. Though Britain has improved its relationship with China following the more combative approach of previous Conservative administrations, a litany of concerns over national security and human rights continues to dog Labour’s attempted refresh. Starmer, who will meet the Chinese president in Beijing Thursday morning, told reporters engaging with China means he can discuss “issues where we disagree.”   “You know that in the past, on all the trips I’ve done, I’ve always raised issues that need to be raised,” he said during a huddle with journalists on the British Airways flight to China on Tuesday evening. In a sign of how hard it can be to engage on more tricky subjects, Chinese officials bundled the British press out of the room when Starmer tried to bring up undesirable topics the last time the pair met. From hacking and spying to China’s foreign policy aims, POLITICO has a handy guide to all the ways Starmer could rile up the Chinese president. 1) STATE-SPONSORED HACKING China is one of the biggest offenders in cyberspace and is regarded by the U.K.’s National Cyber Security Centre (NCSC) — part of Britain’s GCHQ intelligence agency — as a “highly sophisticated threat actor.” The Electoral Commission said it has taken three years to recover from a Chinese hack of its systems. The Chinese state, and private companies linked directly or obliquely to its cyber and espionage agencies, have been directly accused by the British government, its intelligence agencies and allies. As recently as last month, the U.K. government sanctioned two Chinese companies — both named by the U.S. as linked to Chinese intelligence — for hacking Britain and its allies. 2) ACTIONS AGAINST BRITISH PARLIAMENTARIANS Politicians in Britain who have spoken out against Chinese human rights abuses and hostile activity have been censured by Beijing in recent years. This includes the sanctioning of 5 British MPs in 2021, including the former security minister Tom Tugendhat, who has been banned from entering the country. Last year, Liberal Democrat MP Wera Hobhouse was refused entry to Hong Kong while attempting to visit her grandson, and was turned back by officials. The government said that the case was raised with Chinese authorities during a visit to China by Douglas Alexander, who was trade minister at the time. 3) JIMMY LAI In 2020, the British-Hong Kong businessman and democracy campaigner Jimmy Lai was arrested under national security laws imposed by Beijing and accused of colluding with a foreign state. Lai — who is in his late 70s — has remained in prison ever since. Last month, a Hong Kong court convicted Lai of three offenses following what his supporters decried as a 156-day show trial. He is currently awaiting the final decisions relating to sentencing — with bodies including the EU parliament warning that a life imprisonment could have severe consequences for Europe’s relationship with China if he is not released. Lai’s son last year called for the U.K. government to make his father’s release a precondition of closer relations with Beijing.  4) REPRESSION OF DISSIDENTS China, like Iran, is involved in the active monitoring and intimidation of those it considers dissidents on foreign soil — known as trans-national repression. China and Hong Kong law enforcement agencies have repeatedly issued arrest warrants for nationals living in Britain and other Western countries.  British police in 2022 were forced to investigate an assault on a protester outside the Chinese consulate in Manchester. The man was beaten by several men after being dragged inside the grounds of the diplomatic building during a demonstration against Xi Jinping. China removed six officials from Britain before they could be questioned. 5) CHINESE SPY SCANDALS Westminster was last year rocked by a major Chinese spying scandal involving two British men accused of monitoring British parliamentarians and passing information back to Beijing. Though the case against the two men collapsed, the MI5 intelligence agency still issued an alert to MPs, peers and their staff, warning Chinese intelligence officers were “attempting to recruit people with access to sensitive information about the British state.” It is not the only China spy allegation to embroil the upper echelons of British society. Yang Tengbo, who in 2024 outed himself as an alleged spy banned from entering the U.K., was a business associate of Andrew Windsor , the` disgraced brother of King Charles. Christine Lee, a lawyer who donated hundreds of thousands of pounds to a Labour MP, was the subject of a security alert from British intelligence. In October, Ken McCallum, the head of MI5, said that his officers had “intervened operationally” against China that month. 6) EMBASSY DING DONG This month — after a protracted political and planning battle — the government approved the construction of a Chinese “super-embassy” in London. This came after a litany of security concerns were raised by MPs and in the media, including the building’s proximity to sensitive cables, which it is alleged could be used to aid Chinese spying. Britain has its own embassy headache in China. Attempts to upgrade the U.K. mission in Beijing were reportedly blocked while China’s own London embassy plan was in limbo. 7) SANCTIONS EVASION China has long been accused of helping facilitate sanctions evasion for countries such as Russia and Iran. Opaque customs and trade arrangements have allegedly allowed prohibited shipments of oil and dual-use technology to flow into countries that are sanctioned by Britain and its allies. Britain has already sanctioned some Chinese companies accused of aiding Russia’s war in Ukraine. China has called for Britain to stop making “groundless accusations” about its involvement in Russia’s war efforts. 8) HUMAN RIGHTS ABUSES AND GREEN ENERGY U.K. ministers are under pressure from MPs and human rights organizations to get tougher on China over reported human rights abuses in the country’s Xinjiang region — where many of the world’s solar components are sourced. In a meeting with China’s Vice Premier Ding Xuexiang last March, Energy Secretary Ed Miliband raised the issue of forced labor in supply chains, according to a government readout of the meeting. But he also stressed the need for deeper collaboration with China as the U.K.’s lofty clean power goal looms. British academic Laura Murphy — who was researching the risk of forced labor in supply chains — had her work halted by Sheffield Hallam University amid claims of pressure from China. “I know that there are other researchers who don’t feel safe speaking out in public, who are experiencing similar things, although often more subtly,” Murphy said last year. 9) THE FUTURE OF TAIWAN China continues to assert that “Taiwan is a province of China” amid reports it is stepping up preparations for military intervention in the region. In October, the Telegraph newspaper published an op-ed from the Chinese ambassador to Britain, which said: “Taiwan has never been a country. There is but one China, and both sides of the Taiwan Strait belong to one and the same China.” In a sign of just how sensitive the matter is, Beijing officials reportedly threatened to cancel high-level trade talks between China and the U.K. after Alexander, then a trade minister, travelled to Taipei last June. 10) CHINA POOTLING AROUND THE ARCTIC Britain is pushing for greater European and NATO involvement in the Arctic amid concern that both China and Russia are becoming more active in the strategically important area. There is even more pressure to act, with U.S. President Donald Trump making clear his Greenland aspirations. In October, a Chinese container ship completed a pioneering journey through the Arctic to a U.K. port — halving the usual time it takes to transport electric cars and solar panels destined for Europe.

ABOARD THE PRIME MINISTER’S PLANE TO BEIJING — Keir Starmer rejected his Canadian counterpart’s call for mid-sized countries to band together in the face of unpredictable global powers — and insisted his “common sense” British approach will do just fine. The British prime minister arrives in China Wednesday for a trip aimed at rebooting the U.K.’s relationship with the Asian superpower. He’s the latest Western leader to make the visit — which will include a meeting with Chinese President Xi Jinping — after trips by Carney and France’s Emmanuel Macron. Carney used a searing speech at the World Economic Forum last week to warn of the “rupture” caused by “great powers” acting in their own self-interest. While he did not namecheck Donald Trump’s administration, the speech riled the U.S. president, who insisted: “Canada lives because of the United States.” The Canadian PM had called for middle powers to work together to “build something bigger, better, stronger, more just.” Starmer was pressed on those remarks on board his flight to China Tuesday. Asked whether he agreed that the old global order is dead — and whether smaller powers need to team up to push back at the U.S. and China, Starmer defended his own policy of trying to build bridges with Trump, Xi and the European Union all at once. “I’m a pragmatist, a British pragmatist applying common sense, and therefore I’m pleased that we have a good relationship with the U.S. on defense, security, intelligence and on trade and prosperity,” he says. “It’s very important that we maintain that good relationship.” He added: “Equally, we are moving forward with a better relationship with the EU. We had a very good summit last year with 10 strands of agreement. “We’ll have another summit this year with the EU, which I hope will be iterative, as well as following through on what we’ve already agreed. “And I’ve consistently said I’m not choosing between the U.S. and Europe. I’m really glad that the UK has got good relations with both.” Starmer’s government — which faces pressure from opposition parties back home as it re-engages with China — has stressed that it wants to cooperate, compete with and challenge Beijing when necessary, as it bids to build economic ties to aid the sputtering U.K. economy. “Obviously, China is the second biggest economy in the world, one of our biggest trading partners,” the British PM — who is flying with an entourage of British CEOs and business reps — said Tuesday. “And under the last government, we veered from the golden age to the ice age. And what I want to do is follow through on the approach I’ve set out a number of times now … which is a comprehensive and consistent approach to China. “I do think there are opportunities, but obviously we will never compromise national security in taking those opportunities.”

President Donald Trump on Tuesday said he has no problem with the sharp decline in the dollar that’s been triggered by convulsions in global bond markets and growing skepticism about the U.S.’s reliability as a trading partner. “I think it’s great,” Trump told reporters in Iowa when asked about the currency’s decline. “Look at the business we’re doing. The dollar’s doing great.” Trump has long maintained that a weaker currency helps industries that he’s seeking to boost — particularly manufacturers, but also oil and gas. And U.S. corporations that export goods and services abroad typically report stronger earnings when they can convert foreign payments into a weaker greenback. But a soft dollar also diminishes the purchasing power of U.S. businesses and consumers and can lead to higher inflation. That’s one reason why Treasury officials, including Secretary Scott Bessent, have historically advocated for a stronger dollar. Some of Trump’s other advisers — including Fed Gov. Stephen Miran, who’s on leave from his role as the president’s top economic adviser — argue that the dollar’s strength in recent years has placed domestic businesses at a competitive disadvantage to overseas-based companies. The greenback was trading at its lowest level in nearly four years before Trump weighed in on its recent declines. After the president’s remarks, its value sank even further against a basket of foreign currencies. Trump’s foreign policy agenda and repeated tariff threats — including his push to acquire Greenland — have amplified a “sell America” narrative that has hurt the dollar and other U.S. asset prices. A possible intervention to prop up the value of the Japanese yen has also pushed down the dollar over the last week.