Chinese president defends globalisation at WEF in Davos, saying there will be no winners in a trade war

This article is more than 3 years old

This article is more than 3 years old

China’s president, Xi Jinping, has delivered a strong defence of globalisation, serving notice to Donald Trump that Beijing will seek to usurp America’s traditional role as the champion of free trade and open markets.

Xi used an hour-long address to the World Economic Forum (WEF) to take a number of sideswipes at the US president-elect, attacking Trump’s protectionist views without mentioning him by name.

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After later meeting US vice-president Joe Biden on the sidelines of the Davos summit, Xi said that the world needed China and the United States to have a stable and cooperative relationship.

He added that links between the two countries had “weathered wind and rain, but generally have continued to forge ahead”, saying that under Barack Obama there had been a “correct” development in relations.

In the first speech by a Chinese president at the annual Davos meeting of global political and business leaders, Xi said China would keep its borders open, stressed that there would be no winners from a trade war, and urged that all countries continued to support the 2015 Paris climate change accord.

With Trump preparing for Friday’s inauguration in Washington, Xi used the opportunity to make clear that China was keen to take a bigger role on the global stage if the US lapsed into isolationism.

“Pursuing protectionism is like locking oneself in a dark room,” he said. “Wind and rain may be kept outside, but so is light and air.”

Trump campaigned on a strongly protectionist platform, pledging to protect US firms from unfair overseas competition and threatening tariffs on goods from China and Mexico.

“No one will emerge as a winner in a trade war,” Xi told a packed hall at the WEF.

Xi said originally globalisation had been seen as Ali Baba’s treasure trove but for many had become a “Pandora’s box”. He added, however, that the economic liberalisation of the past quarter or a century was not the root cause of the world’s many problems and that the financial crash of 2008 was the result of excessive pursuit of profit.

IHS Markit’s chief economist, Dr Nariman Behravesh, said: “President Xi gave a very rigorous and articulate defence of globalisation.

“Very importantly, he made commitments about opening China up to more imports and foreign direct investment and making sure that China’s exchange rate policy didn’t destabilise the global economy. All this is very encouraging.

“However, actions speak louder than words. A lot will depend on what China does. This is a good start. This is a good set of commitments on his part. It is encouraging, but we will see what the follow-through is.”

Xi likened the global economy to a big ocean from which it was impossible to escape. “Any attempt to cut off the flow of capital, goods, and people between economies, and channel the waters into the ocean back into isolated lakes and creeks is simply not possible.



China’s move towards open markets had been choppy, with plenty of whirlpools and choking along the way,” Xi added. “But we have learned to survive, and we must have the courage to keep swimming in the global market.”

Xi sought to counter fears that the US and China were heading for a currency or trade war. Beijing would keep its doors open and would not seek to drive down the value of its currency, the yuan.

WEF founder Klaus Schwab said Xi’s presence was a sign of the shift from a uni-polar world dominated by the US to a more multi-polar system in which rising powers such as China will have to step up and play a bigger role.



Li Shuo, senior global policy adviser at Greenpeace East Asia, welcomed the commitment on global warming.



“Given the current volatility of global politics, President Xi Jinping’s address helped calm nerves. His reference to climate change highlights a growing sense of China’s international responsibility, and the country’s evolving calculus towards taking action on the issue.

“As Trump drops Obama’s climate legacy, Xi might well establish one of his own. 2017 presents a real opportunity for China to rise to the challenge of responsible climate leadership. Having moved from climate villain to a reluctant leader in five short years over the first half of this decade, it’s reasonable to expect China to become a true leader by its end.”

Davos: the best quotes from day one

Paul Sheard, chief global economist at S&P, on trade wars

“If you did go into a trade ice age, who would be better placed to survive it, economically? I think the answer is the US, because the US is a very large economy, resource rich, with a very large population.

China has got more to lose ... But it’s not clear that Trump has the upper hand. You’ve got the mid-term elections in two years. If it’s like ‘oh my God this guy screwed up’, he’s on a short fuse.”

US secretary of state John Kerry, on the Iran nuclear deal

“Take Iran. If the US were to decide suddenly that we’re not going to pursue this, I bet you that our friends and allies who negotiated this with us will get together, and Russia, China, Germany, France and Britain will say ‘this is a good deal, we’re going to keep it’.

“And we’ll have done a great injury to ourselves.

“There are now no longer 19,000 centrifuges spinning and enriching, there are 5,000, which is the agreement.

“There is no longer a 12,000 kg stockpile that could produce 10 to 12 bombs. There’s 300kg, measurable every day. And you can’t build a bomb with 300kg.”

Douglas Flint, chairman of HSBC, on globalisation

‘Someone’s got to make the counterargument for ‘What has globalisation ever done for us?’.

“The benefits of globalisation in terms of more competition, better productivity, the fact that medium incomes haven’t moved as much as people thought they might, but those medium incomes are buying a great deal more because of the benefits of globalisation in terms of the cost of imported goods.

“The fact that the world’s a healthier place than it was before.”

John Nelson, chairman of Lloyds of London, on Brexit

“We’ve had all the arguments about the various options. We are leaving. We’ve got to get used to it. Let’s get cracking. The sooner we get negotiations going the better. We need decisions at the top.

“We need to make the best of it. It doesn’t make sense to discriminate against the UK as a punishment.

“It is in everyone’s interests to have as much free trade as possible. But I don’t expect a special deal.”

Matt Damon on raising money for his Water.org charity

“We’ve tried humour. A few years ago I went on a toilet strike for an entire year.



“One of the first hurdles we’ve had to clear in the west is that it’s very hard for people to relate to this issue. If you grew up in Europe, if you grew up in America, you’ve never been thirsty in your entire life and you’ve never been five metres away from a clean drink water.

“The water in our toilet is cleaner than the [drinking] water that 663m people have access to.”

Shakira on building schools in Columbia

“Sometimes we encounter a tremendous lack of infrastructure. No potable water in many cases, no electricity, no paved roads, so it definitely means that we have to work twice as hard in order to offer a quality education.

“Not only that, but many of the children concerned are affected by violence or have lost family members.”