Bank of England governor to join Reeves on key China visit

Andrew Bailey, the Bank of England governor, will join Rachel Reeves on a visit to China next month aimed at strengthening financial services trade ties between the two countries.

Sky News has learnt that Mr Bailey and Nikhil Rathi, chief executive of the Financial Conduct Authority, will both accompany the chancellor on the January trip.

Mr Bailey is expected to hold talks with Pan Gongsheng, governor of the People's Bank of China, although there was no confirmation of any meeting between them this weekend.

The attendance of the Bank of England governor and City regulator's boss underlines the importance that the summit, which kicks off on January 11, has assumed for the government.

Earlier this month, Sky News revealed that the Treasury was close to finalising the details of the chancellor's trip, which will include the first UK-China Economic and Financial Dialogue (UK-China EFD) for more than five years.

The visit will come just days before Donald Trump's second inauguration as US President and against a backdrop made more complex by the spying row involving Prince Andrew.

At the G20 summit in Brazil last month, Sir Keir Starmer met China's president, Xi Jinping, and said the UK "would be a predictable and pragmatic partner", according to a government readout of the meeting.

A government spokesperson said this weekend: "The chancellor will visit Beijing in the new year to discuss economic and financial cooperation with her counterpart, Vice Premier He Lifeng.

"Further details will be announced in the usual way in due course and we would not comment on speculation before such a time".

The UK-China EFD will be the first such gathering since June 2019, when Philip - now Lord - Hammond was chancellor.

Deteriorating political relations and the pandemic conspired to prevent further chapters of what was intended to be an annual summit taking place since then.

A bilateral meeting in January will take place amid questions about whether Britain plans to follow the European Union and US in imposing tariffs on electric vehicle imports from China.

Alongside the government-to-government talks, a private sector delegation is expected to hold a financial services summit, attended by companies including HSBC Holdings and Standard Chartered.

Mark Tucker, the HSBC chairman, will lead the private sector talks.

During the chancellorship of George Osborne, the Cameron government prioritised a "golden era" of UK-China relations in which Beijing would authorise tens of billions of pounds of investment into British infrastructure projects.

The Conservatives were criticised, however, for allowing economic ties to prevail over concerns about China's human rights record.

Speaking to Bloomberg two weeks after Labour's general election victory, Ms Reeves said: "We are a small open trading economy and we benefit from those trade links with countries around the world, both for exports and imports, but also for foreign direct investment.

"Our view is that where possible we trade, we co-operate and we challenge in areas where it's important to challenge, but we don't want to close the UK economy down to imports and exports.

"We benefit from those trade links around the world, including with China."

China's current investments in Britain include British Steel, which is owned by Jingye Group.

Thousands of jobs are at risk at its Scunthorpe steelworks amid talks about a government grant to help it transition to greener steel production.

The Bank of England and FCA declined to comment.