Following the very British welcome extended to Chinese President Xi Jinping in the UK this week, today’s agenda will shift to trade, business and investment between the two countries.

The news that China is announcing over £30bn in UK business deals, continues its increasing investment levels into the UK. But these announcements also help to further build a platform for the UK to win future business in China, and also build on the £5.7bn in deals announced during the Prime Minister’s visit to China two years ago.

Whilst these significant levels of investment from China could be seen be some solely as a ‘one-way street’, a key part of these deals, and China’s overall increased engagement, is towards genuine economic partnership with the UK. As many commentators have observed, China is seeking to rebalance its economy away from cheap labour and cheap exports, towards consumption, hi-tech skills and innovation.

For the UK’s Aerospace industry in particular, China’s new objectives offer an opportunity. Last month, and to little coverage here in the UK, China’s Ministry of Industry and Telecommunication Technology (MIIT) finally revealed details of its ‘Made in China 2025’ strategy. The strategy identified 10 key industries in which greater emphasis would be placed to help develop a future of high value goods. ‘Aerospace Technology’ was listed as one these 10 industries. Made in China 2025, is also seen as an industrial precursor to the much anticipated 13th Five Year Plan, set to be revealed in 2016.

This form of ‘industrial policy’ will continue to include large investment from the Chinese government, but as outlined by the Center for Strategic & International Studies, will see more of a move towards using global market mechanisms and the international standard system, to ensure quality. In addition, the CSIS outlines that this strategy will likely lead to greater investment and attention to the ten industries outside China. Whilst there will still be a focus on growing Chinese domestic businesses, companies in other nations will be vital in providing components, technology and new management skills to ensure the plan is successful.

This approach has great advantages for the UK Aerospace industry – as the UK leads the world in developing critical Aerospace technology, and is an important and regular contributor in the global Aviation regulatory and standard setting environment.

As outlined in ADS’ recent report, The China Challenge, the UK must seek to use China’s new focus and industrial policy approach, to ensure it is in a better position to collaborate and invest in growing its share of the Chinese market. This should come from engagement in regulatory setting, further R&D opportunities, as well as greater industry understanding in order to win business against other competition, from other nations.

Increasing the levels of partnership with China in Aerospace, does not mean however, that the UK cannot seek to compete with China in the future. The creation of the Aerospace Technology Institute (ATI) for example, has been critical in ensuring a more strategic approach to the future of UK Aerospace. Funding, investment and support will ensure that UK businesses develop new ideas and technology, align these ideas to the overall strategic direction of the global aerospace industry, and then ensure new products are successfully brought to market, at the right time in the development cycle.

The UK can also seek to compete in the services and support it is able to offer as part of products it sells – as well as continuing to utilise a highly skilled workforce to ensure that innovation is industry wide, and not just created on a ‘product-only’ basis.

During Xi Jinping’s address to the Houses of Parliament, he spoke of a “community of shared interests”. For the UK Aerospace industry such shared interests mean recognising the level of opportunity which presents itself in China, and using China’s renewed approach to its industrial development to focus on: collaboration where interests are aligned, winning orders where business presents itself, and competing where new UK technology and innovation is created.