BRITISH manufacturers are losing out to China’s low-cost labour, but when it comes to training tomorrow’s business leaders this country still appears to rank among the best in the world.

A federation of 6,000 Chinese manufacturers has enrolled Warwick Manufacturing Group at Warwick University to train 200 graduates a year for the next five years.

The Chinese companies, which range from telecommunications to tyre makers, want Warwick to train their brightest engineers to become top managers. They initially want to train 1,000, but if the programme is successful this number will rise.

Lord Bhattacharyya, head of the Warwick Manufacturing Group, said China was desperate to train its people and Warwick offered a multi-discipline approach ranging from imaging to healthcare and aerospace.

He said: “From the president of China downwards, if you look at their backgrounds they are all engineers and scientists. People don’t realise their hunger and thirst to be competitive, and not just on low-cost labour. They are buying up western technology at an unprecedented rate.”

He said in the Pearl River Delta in southern China there were now 20m workers employed in manufacturing. Increasingly the country needed the managers capable of growing these businesses to ensure it competed on the world stage and moved up the supply chain, he said.

Industrialists believe this is China’s greatest challenge and such is the pace of growth that senior managers cannot be trained quickly enough.

The decision by Chinese companies to look to Britain to provide its post-graduate training helps counter criticisim that this country is falling behind in the global skills race.

Sir John Rose, chief executive of Rolls-Royce, said recently that a severe shortage of skills in Britain was forcing his company to recruit half its key staff overseas.

He has turned to the Continent for engineers as the pool of talent shrinks in Britain’s manufacturing sector.

The inventor James Dyson has similar views. But while he has moved his manufacturing overseas, he has kept his research-and-development centre in Britain.