Daily Management Review

Despite Plenty Of Conflicts, They'll Be No US-China Trade War, Prominent Chinese Economist Says


09/04/2017




Despite Plenty Of Conflicts, They'll Be No US-China Trade War, Prominent Chinese Economist Says
A member of the monetary policy committee at the People's Bank of China is of the opinion that there is unlikely to be any change in the relationship between China and the U.S which, according to that expert, has always been tense when it comes to trade.
 
"Look back 20 years ago, the relationship is always bumping. We always have the problem of trade issue," Fan Gang, chairman of the China Reform Foundation, said at the sidelines of the Ambrosetti Forum recently.
 
He said that apart from the more recent issues of traffic that have cropped up between the two countries, China's current account surplus and the alleged currency manipulation by China were a among the issues over trade between the U.S. and China. President Donald Trump had reportedly told advisors in the Oval Office "I want tariffs" in a recent meeting and he has been a heavy critic of China's trade policy. Because of Trump's protectionist view, there has been a rise in the fears over a potential trade war between the countries. But both countries aren't likely to reach that stage, according to Fan Gang.
 
"I don't think (there will be a trade war). There are going to be more trade conflicts but I don't believe there's going to be a war. Both countries are so close, so dependent on each other … In the last minute people will find ways to deal with (trade problems)," he said in a TV interview.
 
Though china’s debt is the main concern for the economy, it is a problem that it will be fixed in the coming years, said Fan Gang, who is one of the most advocate supporters of reforms in China.
 
"Things aren't getting worse," he said about the country's debt pile. He believes that with growth and reform efforts the problem will be solved in two to three years.
 
Warnings on the danger that Chinese debt poses to the global economy have repeatedly been issued by the International Monetary Fund. Warnings about a growing use of complex financial instruments by the global financial agency in mid-August, in noted that in China, there had been a jump in private sector debt. Now, even at the cost of very high levels of debt, doubling the size of the economy in the current decade has been the established and announced aim and objective of the Chinese government. household debt is set to reach 46.3 percent of GDP (gross domestic product) this year and 48.7 percent of GDP in 2018, according to IMF figures.
 
(Source:www.cnbc.com) 






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