The Chinese Premier, Wen Jiabao, has thrown the debt ridden countries of Europe a lifeline.
Yesterday, before boarding a ‘plane for Birmingham for today’s visit to the China owned MG plant in Longbridge, Mr Wen said that China would continue to invest in European sovereign debt.
Mr Wen is on a four day tour of Europe and has already signed 12 trade deals with Hungary as well as agreeing to fund more of that country’s debt.
After the trip to Longbridge, Mr Wen will join David Cameron in 10 Downing Street tomorrow for a UK-China summit before addressing the Royal Society then travelling on to Germany.
During a press conference in Hungary Mr Wen said “China is a long-term investor in Europe's sovereign debt market. In recent years we have increased by quite a big margin our holdings of government bonds. We will consistently continue to support Europe and the euro.”
This will come as good news for those still trying to keep the Eurozone in one piece. It will also be welcomed by the UK government as it will relieve the pressure on UK banks exposed in one way or another to European debt and Mr Wen is also expected to sign a number of trade deals with the UK during his visit.
The trip to the MG Longbridge plant will include the launch of the British designed MG6 Magnette, a car that will be manufactured in parts in China then assembled in the UK. Mr Wen, a Shakespeare fan, is also due to visit Stratford.