Rachel Reeves accused of making Britain a ‘laughing stock’ after returning from China with ‘puny’ investment deal
RACHEL Reeves was accused of making Britain a “laughing stock” after she went cap in hand to Communist China and came back with a “puny” investment deal.
The Chancellor defied calls to stay home and take charge of the market meltdown to jet to Beijing to announce the new economic pact.
Ms Reeves described her visit as a “significant milestone” in Britain’s relationship with China — and said it would help Britain’s struggling economy.
But Tory MPs and business chiefs poured scorn on that after she announced just £600 million of investment from China over five years.
A leading City adviser said of the deal: “There’s a whiff of desperation about it. I’m amazed they think £600million over five years is a good thing.”
He said big international investors are spooked and not investing in Britain.
Ms Reeves also faced mockery for visiting the Beijing shop of UK bicycle maker Brompton — which has imposed a recruitment freeze because of her tax-hiking budget.
Will Butler-Adams, boss of Brompton Bicycles, has seen company profits fall by 99 per cent last year.
He said: “From a business perspective there are a whole load of policies, not least National Insurance, London living wage, that will cost us about £550,000 in the coming year.”
Announcing the deal at a rushed press conference in China, Ms Reeves said she is ushering in a new era of “pragmatic cooperation in action”.
She said: “They represent common ground being found on areas like financial services, trade, investment and the climate.
“They support secure and resilient growth providing mutual benefit for both the UK and China, while safeguarding national security.”
But Communist officials brought the press conference to an abrupt end without any questions being allowed on the state of the markets back in the UK.
Ms Reeves, who met up with Chinese vice premier He Lifeng, is under massive political pressure amid warnings the UK could be hurtling towards a 1970s-style stagflation crisis.
The value of the pound has tumbled while the cost of UK debt — known as gilt markets — has soared because of falling confidence in UK plc.
Mortgage rates are expected to stay higher for longer as the Bank of England is only expected to make one interest rate cut in 2025 because of the grim economic picture.
Furious Tory politicians rounded on Ms Reeves over the market meltdown.
They blamed her £40 billion tax-grabbing Budget for knocking the stuffing out of market and investor confidence.
Tory shadow chancellor Mel Stride fumed: “The Chancellor’s place should be fixing this mess of her own making [back home].
“She should get on a jet and come back to the UK.”
Ex Tory leader Sir Iain Duncan Smith said: “We are the laughing stock of the western world. Europe is toughening up on China and America is going to toughen up on China so we are going to be the odd one out.”
Gareth Davies, shadow financial secretary, added: “She’s flown halfway across the world, and come back with next to nothing to show for it.”
Her deal is the biggest thaw in relations with China since David Cameron was PM.