China's ties and influence within the European Union will be affected if the UK decides to pull out of the bloc. Shanghai is expected to lose influence in the bloc without Britain backing it, analysts have claimed.
They said that the UK has supported China on various issues, including the investment deal between China and the EU. Both parties have agreed to launch a joint feasibility study on China-EU free trade agreement talks.
The South China Morning Post reported that Beijing had indicated its concerns on the possible negative impact of a Brexit when German Chancellor Angela Merkel visited China last week, a diplomatic source said.
According to He Weiwen, the co-director of the China-US-EU Study Centre under the China Association of International Trade, which is a part of the Ministry of Commerce, China will have to take extra steps to boost ties with European Union countries if the UK quits the EU.
"The European Union [without the presence of Britain] is likely to adopt a more protectionist approach when dealing with China. [The cooperation between China and the EU] may become more difficult," he said.
He continued: "For Chinese companies which have set up headquarters or branches in the UK, they may not be able to enjoy tariff-free access to the wider European market after Britain leaves the EU."
According to the Morning Post's report, the UK was the top European destination for Chinese outbound direct investment. A cumulative total of $16.6bn (£113bn; €147bn) was invested in the UK between 2000 and 2015, according to US-based Brookings Institution. That is not all. The UK is also the second-largest trading partner with China in the bloc.
The biggest and most obvious investments include interests in the London Taxi Company, Heathrow Airport and the Manchester Airport. Huawei and Tencent have also set up research and development centres in the UK, the SCMP noted.
Li Ka-shing, Hong Kong's richest man, has already warned that a Brexit would be "detrimental to the UK and it will have a negative impact to the whole of Europe." Speaking to Bloomberg, he said that he would scale back his investment in Britain.
Philippe Le Corre - a researcher with the Brookings Institution and co-author of China's Offensive in Europe - said: "China will probably not give up entirely on the UK, but it will treat it as what it will be: a medium-sized economy with a strong financial focus and not much of an industry left."
Bejing's treatment of the UK as its "best friend" may wane as China is very pragmatic, Corre said.
Chen Long, an economist with the Bank of Dongguan, said: "Britain's economy is one of the best performers in the EU. An exit will leave Germany to stand alone with the problems confronting the bloc, which will ultimately push them to seek cooperation with China over the long run, such as more support for infrastructure investment in Central and Eastern Europe,"
Duncan Wrigley, the head of China research at North Square Blue Oak, an investment bank, said: "For China, it [Britain[ is not the most important market. The EU is the bigger market as a whole."