A vote by the UK to leave the EU on Thursday is unlikely to have much impact on China. The economic and financial linkages between the UK and China are small, at least as far as China is concerned. In particular, exports to the UK are equivalent to just 0.5% of Chinese GDP, so even a sharp slowdown in the UK economy, which we in any case think is unlikely, would have a very small impact on Chinese growth. China is also well-placed to weather any post-Brexit sell-off in financial markets. Because China's capital account remains largely closed, the financial linkages between China and the rest of the world are fairly limited. Meanwhile, large foreign reserves mean the authorities could support the renminbi in the event that it came under renewed downward pressure.
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