Alderman Michael Bear is Lord Mayor of the City of London, the annually-elected head of the City of London Corporation, which provides local government services for the Square Mile, the financial and commercial heart of the United Kingdom. In Hong Kong last week to wrap up his official visit to China, which also took him to Hangzhou, Shanghai, Beijing and Guangzhou, Alderman Bear painted a bright picture of opportunities for British and Chinese companies to work together on infrastructure and other projects. 

What’s your vision for the UK’s financial future when it comes to China?
The visit comes hot on the heels of a visit I had in my office with Vice Premier Li Keqiang, who spoke very fondly of being partners for growth. I was with my Chancellor of the Exchequer George Osborne, so we were talking about partners of choice, partners for growth, and how we move ahead to doubling bilateral trade between China and the United Kingdom from 50 billion dollars a year to 100 billion dollars a year. 

In the United Kingdom, we now have a coalition government some nine to 10 months old, and we are embarking on our own growth agenda, re-balancing the economy. We are going through some austerity programmes as we are losing public services jobs and looking at SMEs and the private sector to take up the slack. The matrix in the United Kingdom is that we have 4.8 million SMEs and we are looking to create roughly half a million jobs, so we are looking to see how we can stimulate the SME sector. 

How does Hong Kong fit in?
Hong Kong and London have a very strong trading relationship. We have about 300 British companies investing in Hong Kong and I know we have more than 200 major Hong Kong companies investing in the UK and the city. So really it’s continued by bilateral trade and foreign direct investment (FDI), which is so important. We are also partners in a number of exchanges – we compete and we’re partners. There is a wonderful opportunity on the horizon that is the internationalisation of the renminbi, which we are looking very closely to see how we can work with you on that.

As far as whether the renminbi becomes a reserve currency or how it links to the International Monetary Fund or Special Drawing Rights, that would take a bit of time. It needs to be sorted through and it can’t happen too quickly. But I think it’s inevitable. There will be a time when between 20 to 30 per cent of world trade is transacted in renminbi, and we are happy to be there to help this happen.

What about major infrastructure projects?
Being an engineer by background, I am absolutely amazed that the infrastructure and buildings that are going on in Hong Kong. And I am delighted to see so much UK expertise is being used for the regeneration and redevelopment of so much of your infrastructure.

I think you have HK$60 billion dollars of investment this year and probably the same amount in the next five years. And UK companies are well-represented in the high-tech and design and implementation of those. I think the Kowloon Cultural district is probably one of the ones that are most interesting.

Do you see opportunities for Hong Kong companies in Britain, perhaps related to next year’s Olympic Games in London?
I think there is huge opportunity in infrastructure. And we provide a very stable and profitable environment for Hong Kong investment. And that’s what I mentioned by FDI from Hong Kong to the UK. It’s a two-way process: we are here to market a very attractive investment climate in the UK.

What about UK initial public offerings here or possible dual listings?
We are very interested in dual listings. Hong Kong did incredibly well last year, with I think 38 billion dollars of IPOs. Dual listings are something that get the best of all worlds, especially in the energy and mining sector, where we have unparalleled expertise.

I think there is an appetite for Chinese companies to come to the UK to float either on the main market, the A-market or the plus-market. We have a huge amount of potential there for dual listings. The depth of the equity and the experience we have is enormous. So it’s for them to make the decision. I am there to show the best opportunities.

The term “Nylonkong” refers to the financial capitals of New York, London and Hong Kong. Do you see Hong Kong as being on par with the other two?
It depends on what “on par” means. If you look at the matrix of the world economy, the economists measured GDP world growth of about 32 trillion dollars in the year 2000, and it’s due to grow to 142 trillion dollars by 2030. So the world economy will double in the next 10 years. Who is going to take advantage of this? You need what I call the “3Cs.” You need commodities, you need surplus cash – and we raise cash, we have deep liquidity in the UK – and creativity. I believe it’s that innovation, that ability to be ahead of the curve, to go up the value chain, which is something we all are in favour of. I think Hong Kong is well up there with us, but I don’t think of you and us being deadly competitors. It’s a global market. We have to carve out our niche and help each other. I think it’s a complementary role.