The ongoing political tensions going on between China and the west have led British corporations to cut off financial ties with Beijing. This decision is even at the cost of providing improved prices to the customers.
Tony Danker who is the director-general of the Confederation of British Industry (CBI), mentioned that he thinks Britain is at the stage now that it has to think about creating new alliances in the world strategically.
He also stated (as mentioned in the Financial Times) that he has talked to several companies, and they all are thinking to modify their supply chains. Tony stated the reason for this is that the companies are anticipating that the political tensions will ultimately lead to the world breaking their inter-relationships with China.
Tony further said that even in Washington, companies are planning to tackle the situations when their ties with China will cease. This will in turn result in the increased cost of living in the UK.
He said that the primary factor which will affect inflation now will not be the target group of customers. But the fact that from where are the items being sourced?
If we are trying to eliminate China from providing chains, inflation will rise and all the trade strategies for Britain need to be planned again in a better way. There will also be a need for new trade partners and re-establishing good relations with the old ones.
The CBI Chief warned about Britain’s economic dependence on China when China’s issue came into the limelight regarding the Conservative candidate race for No 10. Liz Truss and Rishi Sunak got into a heated debate this week regarding who is a better candidate to become the new prime minister.
Each of them accused the other of having close relations with China even when it is a threat to the national and financial security of Britain.
