In news that may partially reassure SMEs fearful of the impact of Brexit, the UK’s new Chancellor Phillip Hammond today confirmed his commitment to helping small businesses access opportunities in China.
Hammond is in China this week, and said: “My focus in China will be on promoting British business opportunities, including in the financial services sector, where Britain is a world leader. Britain is open for business and one of the most attractive destinations in the world for international investment.
“We have built a strong economic relationship with China and as Chinese investments into the UK continue to diversify and as UK exports grow, Sino-UK relations are more important than ever.
“In the last few days alone we have seen the Australian Prime Minister say he wants a new trade deal with Britain – and Japanese technology firm Softbank announce plans for a record investment in the UK. This is all evidence that our economy is fundamentally strong and well equipped to adapt to the change that will be necessary as we leave the EU.”
Gloomy news back home
The comments come a day after news that the UK’s decision to leave the EU has led to a “dramatic deterioration” in economic activity, not seen since the aftermath of the financial crisis. Data from IHS Markit’s Purchasing Managers’ Index, or PMI, shows a fall to 47.7 in July, the lowest level since April in 2009. A reading below 50 indicates contraction.
Spoeaking in Beijing, Hammond urged caution. “Let’s be clear, the PMI data is a measure of sentiment, it’s not a measure of any hard activity in the economy.
“What it tells us is businesses confidence has been dented, they’re not sure, they’re in a period of uncertainty now.”