In a British wellness factory tucked away in Lincolnshire, eastern England, nature is encapsulated in every product. Mushroom powder is carefully measured, packed into capsules, and sealed for export, destined for one of the world's most dynamic markets: China.
For British wellness brand Grass & Co, China represents the first international export destination, capitalizing on the country's booming wellness market.
CEO Ben Grass says the company has leveraged cross-border e-commerce platforms, selling products in China on T-mall, Douyin (China's equivalent of TikTok), and Xiaohongshu (Little Red Book).
"One of the things that's unique from a business perspective about the Chinese market is the sophistication of the e-commerce space in China," Grass tells CGTN. "The way in which live-streaming is used to sell products, the way that delivery systems are so finely honed and attuned – I think China's far in advance of where we are in Europe, in terms of the usage of e-commerce.
"I think the other thing which is very noteworthy is that for a foreign company, an English company, we've been able to use cross-border e-commerce and sell our products in quite a straightforward way to Chinese customers."
Capsules containing mushroom supplements are packaged into bottles at a British factory, ready for export to China. /CGTN
Despite political and trade tensions, Grass expresses optimism about the Chinese market and aims to double the size of the business.
"As a business owner, I think it's really helpful when red tape is minimized," he says. "In an era where there may be tariffs introduced with America, we would like business to be able to happen in a straightforward way with China. At the moment that's the case and we can sell very easily using cross-border e-commerce. We'd like that to continue."
UK/China business sentiment
The UK-China Business Council estimates over 9,000 British businesses are operating in China.
However, a recent survey by the British Chamber of Commerce - which reflects the perspectives of over 300 British businesses operating in China - reveals a mixed outlook. The report indicates that the business environment in China has become tougher for five consecutive years, but investment is stabilizing.
More than half – 58 percent – of UK businesses report that operating in China was more difficult in 2024 than 2023, while only 41 percent of businesses are optimistic about their prospects in 2025. Regardless, 76 percent of companies are maintaining or increasing their investment in China.
British finance minister Rachel Reeves has called for a "pragmatic" relationship with China, the UK's fifth-largest trading partner.
"The UK China relationship has been a little bit static in terms of trade in recent years," says David Henig, Director of the UK Trade Policy Project. "So I think that Rachel Reeves and the new UK government are very much hoping that that can be restarted.
"It feels like the UK-China relationship has not grown as it should do. And I think Rachel Reeves and the new government hope that they can find the answers with Chinese counterparts to how that can be improved."
Britain's finance minister Rachel Reeves, pictured in Brussels last month, wants better trade relations with China. /Yves Herman/Reuters
The Labour government's "pragmatic" strategy includes reactivation of mechanisms such as the Economic and Financial Dialogue and Joint Economic and Trade Committee. Both aim to foster cooperation and dialogue between the UK and international partners, which enable dialogue while addressing challenges like regulatory complexities and market access for businesses.
The relationship has been strained in recent years, with Chinese investors barred from critical sectors like 5G infrastructure and nuclear power projects over security concerns.
"I don't think we should shy away from the fact that it is within the right of individual countries such as China and the UK to define areas where they don't wish to see inward investment," says Henig.
"I think what we've perhaps let happen in the last few years is that we've allowed those differences, all those areas where we don't want to see so much foreign investment, we've allowed that to dominate the whole relationship. And I don't think that's right."
High-level engagement under Labour government
Since Labour took office in July 2024, the UK and China have sought to rebuild bilateral ties.
British Foreign Secretary David Lammy visited China in October last year, paving the way for a meeting between Chinese President Xi Jinping and UK Prime Minister Keir Starmer at the sidelines of the G20 Summit in Brazil.
Reeves' visit to China is being closely monitored by business communities on both sides to see whether diplomatic overtures will translate into tangible trade improvements.
"I think this visit is positive, but we can only see this as part of a process by which UK and China ties in trade should be strengthened and indeed not just in trade," adds Henig. "We have common interests – for example, in tackling climate change. So I think this is part of a process and what we need to do is to speak to each other more regularly."