The results of Great Britain’s most recent referendum, deciding whether the country should stay a part of the European Union (EU), has sparked controversy all over the globe. On Wednesday, June 22nd, Great Britain had voted itself out of the European Union. Worldwide news and social media have been abuzz about “Brexit” since then, and most people are wondering how it will affect not only Europe, but as the world economy as a whole.
Many people involved in business in China have been trying to figure out how this all will affect them. The US-China Business Council Chair John Frisbie recently released this statement:
“When I met with senior economic Chinese officials in March, they specifically mentioned that Britain’s possible exit from the European Union, their second largest trading partner, was something they were watching closely. It is no surprise to see that China has called for a calm and deliberative response to the breaking Brexit news.
Brexit is a reminder of the critical need to be able to effectively engage with China in this time of uncertainty. As the two largest economies in the world, U.S. and China policy coordination is important for stability and for long-term growth. The relationships built up by Treasury Secretaries Hank Paulson, Tim Geithner, and Jack Lew with their counterparts in China through the S&ED and other engagement pay off at times like these.”
Europe, being China’s second largest trading partner, is and remains extremely crucial for the world economy. This current change in stability may have both short term and long term effects on trade stability not only between Europe and China, but for all countries trading in China. Now more than ever, stability in trade becomes crucial, especially for the trade relationship between the US and China.