Davos,
Switzerland (CNN Business)China has a
message for the Davos crowd: Fear about an economic slowdown is overblown.
In a speech
at the World Economic Forum, Vice President Wang Qishan said that growth
remains substantial, and that it's important for China to focus on the long
term.
"There
will be a lot of uncertainties in 2019, but something that is certain is that
China's growth will continue and will be sustainable," he said Wednesday.
Earlier this
week, China reported that its economy grew 6.6% in 2018, the slowest pace in
almost three decades.
Activity has
been hit by government efforts to rein in high levels of debt with the aim of
putting the vast economy on more stable footing. Momentum has also been
blunted by the trade war with the United States, which has led to tariffs on
hundreds of billions of dollars in Chinese exports.
Wang, for
his part, took a glass-half-full view of the data.
"I
think [6.6%] is a pretty significant number," he said. "Not low. At
all."
Wang said
that the Communist Party is "trying to remind people that speed does
matter, but what really matters for the time being is the quality and
efficiency" of development.
Chinese
officials have echoed this sanguine take throughout the week.
Fang
Xinghai, vice chairman of the China Securities Regulatory Commission, said at a
panel on Tuesday that growth as low as 6% would not be "a disaster."
Still,
concerns about China's slowdown and what it means for global growth have
rattled markets.
Chen
Xingdong, chief China economist at BNP Paribas, said Wednesday that Beijing
faces the most difficult economic situation since the global financial crisis.
"Growth
is slowing down quite dramatically," Chen told reporters. "The magnitude
of the slowdown has been intensifying."
China has
been working to support growth through a combination of looser monetary policy and fiscal
stimulus such as tax cuts for small businesses.
And bright
spots do remain. Retail sales in China are set to reach more than $5.6 trillion
this year, about $100 billion more than in the United States, according to a
report published Wednesday by research firm eMarketer.
But the
specter of tougher trade penalties looms.
China and
the United States are racing to cut a deal on trade before March 1, when
tariffs on $200 billion in Chinese goods will otherwise rise to 25% from 10%.
Negotiations with top officials are scheduled later this month in Washington, although an invitation by
Beijing to hold preliminary talks this week was rejected by the White House.
BNP Paribas
sees a 60% to 70% chance that a US-China trade deal gets done. The alternative
is grim, and would "cause a massive increase in job losses," Chen
said.
Wang
appeared to take a jab at the Trump administration and to offer an olive branch
at the same time.
"Shifting
blame for one's own problems onto others will not resolve the problems,"
he said in prepared remarks.
Later, asked
about the US-China relationship during a question-and-answer session with the
WEF chairman, Wang said that the two economies rely on each other, so
"there has to be mutual benefit and win-win."