Britain’s Keir Starmer is in China this week, marking the first visit by a UK prime minister in eight years and hailed by Beijing as a potential “new chapter” in relations.It is the latest in a string of Western leaders seeking a rapprochement with Beijing, as US President Donald Trump turns on traditional allies.Starmer hopes to boost trade after years of strained relations, but must balance this with security concerns raised in the UK over a potential threat posed by China.Here are the three key questions surrounding the visit:- Where do relations stand? -London and Beijing enjoyed what they describe as the “Golden Era” a decade ago — a time when then-prime minister David Cameron and Chinese President Xi Jinping famously enjoyed beers together at a British pub.But relations soured since 2020, when Beijing imposed a national security law on Hong Kong and cracked down on pro-democracy activists in the former British colony.Human rights abuses, alleged spying and cyber attacks, and China’s perceived support for Russia’s war in Ukraine also strained ties.Nevertheless, China remains Britain’s third-largest trading partner, though UK exports to the East Asian country plummeted 52.6 percent year-on-year in 2025, according to British government statistics.And in December, Starmer said it would be a “dereliction of duty” not to engage with Beijing. – Why is Starmer visiting now? -Relations began to thaw soon after Starmer took the helm in 2024 following a closed-door meeting with Xi in Brazil in which the UK prime minister said Britain would look to cooperate with China on issues such as climate change.But a protracted row over Chinese plans to build a vast new embassy in London complicated plans for Starmer’s visit.Beijing purchased the building, on the site of the former Royal Mint, in 2018, but opponents argued that the “mega embassy” will be used for espionage and pressure rights activists in Britain.The plan was finally approved on Tuesday and made way for China’s invitation to Starmer with a UK government spokesperson saying intelligence agencies have plans to “manage any risks”.Starmer’s trip also comes as Britain faces a rift with its closest ally, the United States, following Trump’s bid to seize Greenland and his brief threat of tariffs against the UK and other NATO allies.With Trump increasingly tearing apart the global order, “China might not be an ally, but it is also not an enemy”, Kerry Brown, director of the Lau China Institute at King’s College London told AFP.Facing a lacklustre British economy, Starmer will also be looking to seal trade deals to boost growth at home.China has expressed hopes for the visit, with foreign ministry spokesman Guo Jiakun on Tuesday calling it an opportunity to “deepen practical cooperation with the UK, jointly opening a new chapter in the healthy and stable development of China-UK relations”.- What’s on the table? -Starmer will arrive with an entourage of industry executives hoping to promote British business through a UK-China CEO Council, a body that has lain dormant for years.Created in 2018, the council once brought business and industry executives from both countries together when relations were in their “golden era”.Starmer is also expected to raise the case of Hong Kong media mogul and democracy supporter Jimmy Lai, a British citizen and founder of the now-shuttered Apple Daily tabloid.The 78-year-old is facing years in prison after being found guilty of collusion charges in December under the new national security law.Xi and Starmer are also likely to discuss Ukraine, where Beijing is accused of enabling Russia’s invasion through its close economic ties to Moscow.The visit will represent a “shift toward managed re-engagement rather than renewed strategic trust”, according to Jinghan Zeng, an international relations scholar at City University of Hong Kong.While progress could be made on climate change, trade, and people-to-people exchanges, “concrete outcomes will probably be modest”, he said.

Stock markets rallied Tuesday following Wall Street’s healthy lead, with tech firms leading Seoul to another record as investors brushed off Donald Trump’s threat to hike tariffs on South Korean goods.The yen held its gains after a two-day surge stoked by intervention talk, while geopolitical and economic uncertainty saw silver hit another fresh peak and gold hover just below its own high.Traders are also gearing up for a Federal Reserve policy meeting and earnings from tech titans, which will be pored over for an idea about sustainability of the AI investment surge.Equities enjoyed healthy buying despite the US president reverting to tariff threats, warning South Korea he would impose 25 percent tolls on goods including autos for falling short of expectations on an earlier pact struck with Washington.The announcement comes months after the two sides struck a trade and security deal following tense negotiations, setting levies at 15 percent.”South Korea’s Legislature is not living up to its Deal with the United States,” Trump wrote on his Truth Social platform.He added that he was increasing tariff rates “because the Korean Legislature hasn’t enacted our Historic Trade Agreement, which is their prerogative”.The presidential office in Seoul said it had not been informed in advance but added that Trade Minister Kim Jung-kwan, currently in Canada, would head to Washington for talks with US Commerce Secretary Howard Lutnick.Trump’s outburst follows a warning to Canada on Saturday that it faced 100 percent levies if it signed a trade deal with China, days after backing down from a threat to hit several European countries with measures over their opposition to his grab for Greenland.Still, Seoul’s Kospi continued its run to fresh record highs by jumping 2.8 percent, with observers pointing to the US president’s history of rowing back the worst of his threats.While carmakers slipped, tech firms ploughed higher with chipmaking giant SK hynix up 8.7 percent and Samsung Electronics up 4.8 percent.There were also big gains in Hong Kong, Shanghai, Sydney, Singapore, Taipei, Bangkok, Manila and Jakarta.London, Paris and Frankfurt all opened with gains.- India-EU trade deal -Mumbai advanced in early trade after India and the European Union unveiled a free-trade deal totalling about a quarter of global GDP, following two decades of negotiations.Indian Prime Minister Narendra Modi said the agreement “will bring many opportunities for India’s 1.4 billion and many millions of people of the EU”.Tech firms are enjoying a fresh boost ahead of earnings releases as traders continue to pile into all things AI.Magnificent Seven members Apple, Microsoft, Meta and Tesla are due this week, with other bellwethers including Texas Instruments, Boeing and Mastercard providing an idea about the state of the economy.However, with questions being asked about the amount of cash being invested in artificial intelligence, there is a little nervousness on trading floors about when profits will be realised.”The AI capex cycle is increasingly colliding with the real world: debt markets, power grids, and regulation,” wrote Matt Weller, head of market research at City Index.He added that “2026 capex estimates for the largest ‘hyperscalers’ is widely forecast to hit the $600 bn+ range, driven primarily by AI infrastructure. At the same time, major tech firms have leaned more heavily into debt issuance to fund the infrastructure race”.”This matters for earnings because the market’s attention is moving from ‘who spends the most’ to ‘who can sustain the spend without eroding free cash flow’, especially if AI monetisation takes longer than expected.”Developments in Washington are also being followed after some senators warned they would vote against upcoming spending bills following the second killing of a US citizen in Minneapolis, threatening another possible government shutdown.The dollar remained under pressure after its latest selloff sparked by talk of a joint intervention between US and Japanese authorities to support the yen.And in corporate news, Hong Kong-listed shares in China’s Zijin Gold International rose 1.5 percent after it agreed to buy Allied Gold, which owns gold mines in Africa, for US$4 billion. Its parent, Zijin Mining Group, soared more than six percent before paring the gains.Zijin Gold’s shares have tripled since listing in September. – Key figures at around 0815 GMT -Tokyo – Nikkei 225: UP 0.9 percent at 53,333.54 (close)Hong Kong – Hang Seng Index: UP 1.4 percent at 27,126.95 (close)Shanghai – Composite: UP 0.2 percent at 4,139.90 (close)London – FTSE 100: UP 0.3 percent at 10,177.21Dollar/yen: UP at 154.73 yen from 153.98 yen on MondayEuro/dollar: DOWN at $1.1870 from $1.1883Pound/dollar: UP at $1.3684 from $1.3682Euro/pound: DOWN at 86.74 pence from 86.85 penceWest Texas Intermediate: DOWN 0.5 percent at $60.37 per barrelBrent North Sea Crude: DOWN 0.6 percent at $65.23 per barrel