British business signed deals with China worth $40 billion

As the participation of China in the British nuclear industry was sealed with a deal worth an estimated £6 billion, Mr Xi used a speech to the China-UK Business Summit to brush aside concerns over the world’s second-largest economy that have rocked commodity and stock markets around the world in recent months, reports The Times.

In other transactions:

• Carnival Corporation formed a joint venture with the China State Shipbuilding and China Investment corporations to launch the first domestic cruise brand in China.

• Rolls-Royce signed $2.4 billion of supply and maintenance contracts with Hainan Airlines, Tianjin Airlines and Capital Airlines covering Trent 700 engines for 44 new Airbus A330s.

• Aston Martin signed a £50 million deal for the development of an electric version of its Rapide sports car with China Equity, a private equity firm.

• China Capital Investment is investing £200 million in media training programmes at the University of York for 300 Chinese students a year.

• Alexander Dennis, the Scottish bus manufacturer, tied up with BYD, a Chinese automotive group, in a contract understood to be worth as much as £2 billion to build electric buses.

• SinoFortune, a construction group, has invested £100 million in the development of the £3.2 billion London Paramount Entertainment Resort, which is scheduled to open in 2021.

“The main [economic] indicators are staying within a reasonable range and are consistent with expectations,” Mr Xi told an audience at Mansion House in the City that included the bosses of some of Britain’s biggest businesses, including BP, Royal Dutch Shell and Rio Tinto.

“Admittedly, the economy does face some downward pressure and structural problems, but such adjustment is both inevitable and normal when the economy has reached a certain stage after years of high growth.

“The Chinese economy will operate within the proper range and there will be no hard landing.”

His comments came amid growing fears that China’s official growth rate of 6.9 per cent paints an overoptimistic picture of how quickly the economy is growing, a trend that will have huge implications for global growth.

Speaking earlier in the day, David Cameron pledged that Britain would be China’s “partner of choice” in the West. Bob Dudley, the chief executive of BP, which announced two deals with the Chinese yesterday, insisted that the day was of more than ceremonial importance: “When you have an event like this it sets a date . . . A date always drives business. No one wants to disappoint.”

The trade deals announced yesterday to coincide with Mr Xi’s state visit included an agreement between Merlin Entertainments and China Media Capital to develop a $300 million Legoland theme park in the Shanghai area, with the British group investing an estimated £30 million.

The tie-up between the FTSE 100 company, which operates four Madame Tussauds attractions and an Ocean World aquarium in China, also includes a commitment to develop a chain of smaller “midway” attractions under Merlin’s existing Dungeon and Legoland Discovery Centre brands, plus the development of a new midway brand based on DreamWorks’ popular Kung Fu Panda film franchise. Merlin recently opened the first DreamWorks Tours Shrek’s Adventure in London.

Nick Varney, Merlin’s chief executive, said that although the plan was to expand the Shrek concept to at least five more locations worldwide, until now the intellectual property rights to DreamWorks films in China had been held by Oriental DreamWorks.

He said that because China Media Capital was a big shareholder in Oriental DreamWorks, that exclusion from China now would be removed, although the Kung Fu Panda brand would be used as it was more relevant to a Chinese audience.

Mr Varney said that although Merlin’s leading markets were Britain and the United States, that would change: “I believe the USA could eventually get to three Legoland parks and forty midway attractions, and I think China could get to a similar size over the next decade.”