China Exclusive: "Reforms back our confidence in Chinese economy": Morgan Stanley Asia Pacific Co-CEO
Xinhua, April 1, 2017 Adjust font size:
Wei Sun Christianson has spent time as Morgan Stanley's China CEO for over a decade, and as Asia Pacific Co-CEO since 2011, giving her a unique insight into the rapid rise of the world's second largest economy and the following painful slowdown since the global financial crisis.
Despite the ups and downs, her confidence in China has remained unchanged, she told Xinhua during an exclusive interview. Christianson said this confidence stemmed from China's structural reforms and economic transition.
Regarding the launch of the supply-side structural reform drive, which began in 2016, she said there was enormous demand in China for upgrades to industries and consumption, which, she said "will help the economy maintain a medium-high growth rate over the coming decade."
Reforms in state-owned enterprises, land use, household registration and taxation will ensure the economy is sustainable, Christianson added.
In a lengthy report released last month, the New York-based investment bank predicts China will break out of the middle income trap by 2027, with its per capita income to reach 12,900 U.S. dollars to become a high income country, up from the current 8,100 U.S. dollars.
China is pushing for an economic shift from industry to services and from investment to consumption. It is already bearing fruit: Consumption contributed 64.6 percent of GDP in 2016, up by 4.9 percentage points from a year ago.
Christianson expects the ratio to continue to rise as incomes continue to grow. "China will have a 9.7-trillion-dollar consumer market by 2030, the largest in the world."
Given warming signs in the economy since the start of the year, Christianson said the timing is perfect for further reforms.
China saw better-than-expected major indicators in the first quarter, including trade and factory activity.
"Those indicators, including a rising producer price index, tells us that the economy is strong enough to bear reform measures, such as adjustments on the supply-side to cut excess production capacity," Christianson said.
The central government has reduced its growth target for this year to 6.5 percent, part of efforts to create leeway for economic overhauls.
"Reform will give the world a more stable China, not only a locomotive but a stabilizer of the global economy in the long run," Christianson said, "The progress may not be very fast. But it is steady and practical, and built on a solid foundation."
Christianson was one of the first Chinese students to study in the United States after China's opening up. After receiving the Juris Doctor degree at Columbia Law School, she worked overseas for years and was the first Chinese-born female executive of a Wall Street investment bank.
Encouraged by increasing opportunities from an opening China, she returned to take up the position of chief representative of Morgan Stanley in Beijing amid the Asian financial crisis nearly 20 years ago.
"China has kept a steady pace in opening up for years, and there have been substantial improvements in the business environment for foreign companies," Christianson said.
Despite the external risks, China has never hesitated in integrating into the world economy, with continued efforts to grant easier access for foreign investors.
Christianson expects reforms and opening up to bring opportunities to more foreign companies eager to increase their presence in China, one of the world's most valuable markets, citing China's fast-growing consumer market and service sector.
"For example, China's bond market is the most attractive to overseas investors, who are eager to enjoy the opportunities," she said.
A pioneer in the Chinese market, Morgan Stanley has witnessed the country's rise. It is about to celebrate its 23rd anniversary in China this year with its more than 1,000 local employees. Endi