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China to work its way through world economic downturn: Former AIG CEO

12-20-2011 09:53 BJT

by Niu Hairong, Christine Schiffner

NEW YORK, Dec. 19 (Xinhua) -- As some people were debating whether China was heading for a hard landing or a soft landing in the coming year, Maurice Greenberg, the legendary former CEO of the American International Group (AIG) showed his confidence in the world's second largest economy.

"My belief is that China will have a soft landing because they are capable of managing more rapidly than most of other countries," Greenberg has said in a recent exclusive interview with Xinhua. "If things need to get done, they get done."

Sitting in his Manhattan office filled with unique decorations from all over China, the 86-year-old businessman told Xinhua reporters he visited China several times each year.

Indeed, on Wall Street, Greenberg was not only famous as the former chairman and CEO of AIG, which used to be the world's largest insurance and financial services corporation, but also known for his deep involvement in the U.S.-China relations.

"I think that China will slow down from 8 plus percent to probably 7 percent, but they'll work their way through it," he said.

Among many risks China has to deal with, Greenberg believed the ongoing debt crisis in Europe is a major concern.

"Unlikely Europe is going to resolve its problems in 2012," he said. "If Europe continues like that, as I mentioned, (China's) exports will come down, they will have to adjust accordingly."

"They have to cut taxes on the manufacturing sector. They may have to increase the movement of building housing, moving more people from the countryside to the cities, creating service jobs and stimulating the consumer market. But they'll do those things," he added

"Real estate has got some bubbles in some parts of China, but that's not a tragedy," Greenberg noted.

When talking about the trade relations between China and the United States, Greenberg said coordination and cooperation between the two biggest economies are more important at a time when the world is suffering an economic downturn.

"China should be a friend, a trading partner," he said. "We'll always have some differences... but it doesn't mean that suddenly because you have differences, that you're enemies. We are the two largest economies in the world, in many ways we complement one another."

Greenberg said he has advocated a free trade agreement with China even though it may take years to do so, since he believed it's the best thing for both countries.

"Because we'll be then going into each of the problems that exist now between us and we'll be talking them through rather than having them discussed in the headlines that just aggravates the situation."

"For the long term we should move to that direction," Greenberg stressed. "I think we have so much in common that we need to not let the differences overwhelm the things that we have in common."

Editor:Zhang Hao |Source: Xinhua

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