For our first seminar of study block 2 AY2022/23, we have the absolute pleasure of having Dr Ian Zhu visit us at our UK Campus and to give our staff and students a seminar on the Opportunities and Challenges of Chinese Investments into the UK.
Dr Ian Zhu is a multi-lingual FCA/ACSI qualified and accomplished trade and investment consultant with more than 20 years of experience in delivering financial solutions with board-level strategic advice to clients in China, Hong Kong, and the UK. Dr Zhu is highly skilled in bi-lateral international trade and investment and has held senior roles at both British and Chinese corporations, of which include the world’s top 79 Chinese State-owned Enterprise (China Resources Group), the world’s top 60 Chinese private multinational telecommunication giant (Huawei), a large family office in China (Reignwood), and the world’s fifth largest professional service provider (Grant Thornton). Through his vast experiences, Dr Zhu has acquired a deep understanding of both Western and Chinese business culture and working practices, in particular the elements necessary for trust building between the West and China. He is a valued and trusted strategic advisor at the highest level with a strong track record in new business generation and team leadership.
In his seminar, Dr Zhu talked about how he developed the Grant Thornton Tou Ying (投英) Tracker in collaboration with the Chinese Chamber of Commerce in the UK (CCCUK) and China Daily UK. Currently in its 9th year, the Tou Ying Tracker 2021 research once again reaffirms the contribution of Chinese companies in the UK. After considering 845 Chinese companies, the tracker sees that these Chinese companies have a combined revenue of £63 billion and in total, they employ 60,945 people in the UK. Due to global economic uncertainties as a result of the Covid-19 pandemic and at the home front unresolved post-Brexit arrangements, the tracker sees Chinese investors and businesses taking a more cautious approach to expansion in the UK. In 2021, there was a dip in revenue growth (12 % in 2020, and 5% in 2021) and employment (down from 75,000 in 2020).
Despite the slight dip due to the complexity of global economics, Dr Zhu pointed out that this is the fourth consecutive year of growth in the number of Chinese companies investing in the UK. The Tou Ying Tracker demonstrated that in 2021, there were many new entries in the 30 fastest-growing companies (by revenue) and they come from seven of the highly innovative sectors. This shows that Chinese companies in the UK are developing different revenue streams and connections.
It is common knowledge that investment boosts economies. Thus, it is unsurprising to see how Chinese investments boost local regional economies in the UK. As Dr Zhu explained in his seminar, the Tou Ying Tracker Report 2021 show that Chinese companies have created and supported almost 61,000 jobs in the UK. Of these, almost 30% work in the North West, and 20% work in London. Dr Zhu highlighted that despite the low percentage, London accounts for 80% of aggregate revenue. The other half of the employees work in the East of England, West Midlands, Scotland, Northern Ireland and Wales. Most notably, Dr Zhu highlighted that the mid-market (£50 million - £1 billion) is where one would find almost 70% of employees, though the sector represents only 10% of the companies.
Thus, in order to encourage more Chinese investments and to boost the UK economy further during a global economic crisis, Dr Zhu focused on describing some of the factors that would be useful for UK businesses to consider before embarking on a new relationship with Chinese investors. In particular, he advised that it would incredibly useful for UK businesses to understand some of the challenges that Chinese investors may be concerned with. These include, complex geopolitical dynamics, high compliance and regulatory costs, establishing a bilingual workforce, building trust, integrating business cultures, high employment costs, as well as economic and finance challenges, just to name a few.
Finally, Dr Zhu ended the seminar with an optimism for the future of Sino-UK trade and investments. He explained that the UK and China can be confident about the prospects between the two nations in 2022 and beyond. As Dr Zhu explained, the long-term outlook for living with Covid-19 in China and the rest of the world will definitely become more certain. In addition, with a new government in place in the UK, it would bring more stability and certainty for investors. Further, in the face of global economic uncertainty, the UK will be more focused on resolving post-Brexit arrangements so as to boost UK investments and trade. In conclusion, Dr Zhu believes that while both nations will be focused on their domestic policies - "common prosperity" and "dual circulation" in China, and levelling up in the UK - he is certain that both the UK and China would also look outward to attract more foreign investments.
It was definitely an insightful seminar where the staff and students of PHBS-UK we able to learn more about Chinese investments in the UK. We thank Dr Zhu for taking the time to share his expertise and experience with us and we look forward to welcoming him back to our UK Campus in the future.
