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 After a day of pomp, Xi will get down to business at Cameron's
Downing Street residence and attend a meeting in London with chief
executives of big British companies.
The highlight of that summit is expected to be an announcement that
state-owned China General Nuclear Corporation (CGN) will take a $18
billion ($28-billion), one-third stake in the Hinkley Point nuclear
plant owned by France's EDF <EDF.PA>.
"A growing China-UK relationship benefits both countries and the
world as a whole," Xi told a state banquet at Buckingham Palace
hosted by Queen Elizabeth on Tuesday night.
Cameron is pitching Britain as the pre-eminent Western gateway for
investment from China, though the warmth of the reception for Xi has
raised some eyebrows with allies and drawn criticism that London is
ignoring China's human rights record.
Protests on the street against the Communist leader have been small
so far, despite activists accusing Cameron of courting Chinese money
while brushing aside criticism of a crackdown in civil liberties
since Xi came to power in 2012.
 British officials and business leaders say the rise of China is
impossible to ignore: China's economy - the second biggest in the
world - is four times the size of Britain's.
"We encourage investment, and China is investing more in Britain now
than other European countries," Cameron, who wants to make London
the dominant Western center for renminbi trade, told China Central
Television.
China on Wednesday nearly doubled a bilateral currency swap
agreement with Britain to 350 billion yuan ($55 billion), part of
Beijing efforts to spur more use of the yuan abroad.
NUCLEAR DEAL
In what is likely to be the biggest deal of Xi's visit, China will
take a stake in the EDF project in Somerset that is due to start
operating by 2025 and is the first European nuclear plant to be
built since Japan's Fukushima disaster in 2011.
The Chinese investment, agreed in principle in October 2013,
breathes life into a British plan to replace around a quarter of its
electricity generating capacity over the next decade and offers
China a way to showcase its nuclear technology as part of its pitch
as a global exporter of quality infrastructure.
As part of the deal, EDF and CGN will also cooperate to license a
Chinese-designed reactor and to build it at a site near London and
elsewhere in the world.
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The deal brings Britain's first new nuclear plant since 1995 a step
closer and is also a boost for EDF, which has been hit by billions
of euros of cost overruns and years of delays with two of its other
European nuclear projects in Finland and France.
As part of the deal, which EDF has still to sign, the French group
may agree to cede majority ownership on a new nuclear project at
Bradwell, east of London, to CGN.
The prospect of China, which Western spymasters say sponsors hacking
of global companies, helping to build a nuclear plant in Britain and
being involved in running others has stoked security concerns in
Britain.
Steve Hilton, a former policy adviser to David Cameron, told the BBC
that Britain should impose sanctions on China for political
oppression and cyber attacks instead of rolling out the red carpet.
"This is one of the worst national humiliations we've seen since we
went cap in hand to the IMF in the 1970s," said Hilton, who left
Downing Street in 2012, referring to the 1976 crisis during which
Britain was forced to ask for a loan from the International Monetary
Fund.
"The truth is that China is a rogue state just as bad as Russia or
Iran, and I just don't understand why we're sucking up to them
rather than standing up to them as we should be."
China has strongly denied previous accusations of espionage, saying
it is itself a victim of cyber attacks.
China has feted Britain for a visionary choice to strengthen ties,
though some British lawmakers have also pressed Cameron to raise the
issue of cheap Chinese steel imports after over 4,000 jobs were
thrown into jeopardy at steel plants across Britain.
(Additional reporting by Karolin Schaps and Patrick Graham; Editing
by Louise Ireland)
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