5 August, 2019 - 11:32 By News Desk

China and Cambridge – a very special relationship

The metaphorical wall around the city of Cambridge has come tumbling down, writes Nick Finlayson-Brown, partner at Mills & Reeve who heads up the firm’s China team and Cambridge office

Where once the availability of finance for startups rested with the largesse of successful local entrepreneurs or a day trip to London on a slow train, we now sit at the centre of one of the fastest growing and most successful economies in the world and global investors in their multitude of forms are here. 

And the international interest in what Cambridge and the region has to offer expands further through a virtuous circle of commercialised technical expertise, investment and growth founded on the bedrock of our educational institutions. 

That interest is perfectly illustrated by the major Chinese presence in Cambridge, ranging from direct investment in the economy to the plethora of Chinese business generation bodies that have been established in the city.

China takes centre stage as Brexit concerns remain

This interest becomes even more important with uncertainty remaining over Brexit and the allegedly special relationship between the UK and US increasingly strained. 

China is now taking centre stage in terms of growth opportunities and investment for Cambridge life science and technology companies.
The Chinese preoccupation in Cambridge is equally well illustrated by the growth in Mills & Reeve’s China Desk from a team of two 15 years ago to a team of 12 now, including Mandarin speakers and Chinese nationals. 

Given the increasing participation of Chinese companies in global markets, often providing inbound investment, we expect the importance of China to the Cambridge economy will only increase in the years to come.

So, what will the key trends in Chinese-UK collaboration be in the next five years?

In recent years, the Chinese government has imposed restrictions on capital flight as part of its Belt and Road Initiative, reflecting its desire for carefully targeted investment in key sectors.

As a result, investment in volatile sectors such as real estate has been replaced by frenetic interest in buoyant innovative sectors such as technology and life sciences. 

This is clearly great news for Cambridge, and the wider Golden Triangle, as we are leading the way with the convergence and cross-fertilisation of the education, health, and technology sectors into life sciences, med-tech, AI and machine learning.

From startups to global corporates

At the same time Cambridge, historically a home of small-scale hi-tech start-ups, is attracting global corporates like never before. 

Activity over recent years has included the entry of US giants Microsoft, Apple and Amazon, Google acquiring Cambridge based AI start-up DeepMind, Japanese Softbank taking over Cambridge based Arm and Korean behemoth Samsung setting up a research and development facility.

This evolution of the Cambridge business environment, together with its strength in sectors that have branched off from academia means that Chinese companies have become increasingly active in Cambridge. 

Delegations of business and government representatives from China pass through Cambridge with increasing frequency, including tech giants Alibaba and JD.com.

Setting up home

Some of these firms have now decided to set up shop. For example Huawei, which was already present at the Science Park, has invested in new facilities at the former Spicers site in Sawston, South Cambridgeshire. 

By making this investment, it is standing shoulder to shoulder with other Cambridge-China collaborative success stories, for example, TusPark’s collaboration with Trinity College.

TusPark is one of the commercial investment and incubator arms of Tsinghua University, one of China’s most illustrious universities, and has built tech cities at numerous sites across China. Each tech city alone has a population of around 200,000, dwarfing Cambridge’s term-time population of 120,000.

TusPark has collaborated with Trinity College to redevelop part of the Cambridge Science Park in a deal reportedly worth £200 million. The state of the art incubator facility boasts tenants including video game developer Frontier Developments plc alongside a state of the art biohub facility that will act as an incubator for early stage biotech and medtech companies, as well as providing facilities for more established companies to grow. 

TusPark’s interest in the Cambridge and wider UK economy does not stop there. TusPark has invested in innovative cancer therapeutics company Biosceptre and medtech firm Diagnostics for the Real World. The company has also pushed ahead with further UK expansion with a new incubator located in Newcastle city centre.

TusPark does not just invest in companies in Cambridge. It offers know-how and practical support for Cambridge-based companies to expand their operations in China. 

Mills & Reeve recently visited TusPark Science Park sites in Qingdao and Beijing, which offer extensive facilities to UK companies and are open for business.

Cultural importance

China also presents an enormous potential market for UK companies. Companies such as Jaguar Land Rover have had great success in the Chinese market. 

However, expansion in China also presents challenges but language and cultural differences can be overcome by having Mandarin speakers. 
Equally, it is important for non-Mandarin speakers to have basic awareness and respect for Chinese culture. For example, by wishing business contacts well on traditional Chinese holidays. 

However, we are also increasingly seeing a willingness to engage by companies on both sides and more widespread acceptance of international business practice.

The legal market

In the legal market the strength of the relationship between China and the UK is evidenced by our own network of Chinese law firms ranging from boutique to international firms referring a steady stream of instructions both ways each week. 

These instructions come from Chinese companies ranging from independents to state owned enterprises. As a result, we see the Chinese market as an important part of our future, as well as that of the local economy.

So while for some the US-UK ‘special’ relationship has shown signs of strain in recent months, China-UK relations seem to be going from strength to strength – especially in Cambridge.


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