(Chinanews.com/Luo Yunfei)

The subprime mortgage crisis in the US is not going to happen to China, as China’s financial risks are controllable, a Chinese economist told Chinanews.com on March 26, during the ongoing Boao Forum for Asia (BFA) Annual Conference.

Wu Xiaoqiu, vice-president of Renmin University of China, noted that China’s commercial banks which allocate more than 75 percent of financial resources across the country are under strict supervision and maintain steady growth.

Furthermore, the exchange rate of Chinese currency Renminbi (RMB) remains stable, and there is little possibility that the country will suffer a substantial depreciation in RMB or a currency crisis, Wu said.

He added that China’s economy relies mainly on endogenous driving forces rather than foreign capitals. Therefore, the Chinese currency will not face a depreciation crisis if foreign investors withdraw their investments when the bonuses of growth diminish.

China’s major financial risks come from debts within local government, said Wu.

He added that China’s economy would maintain an “L-shape” growth in the years to come. Measures must be made to control fast-growing local debts, especially those that are likely to exceed the gains brought by economic growth.

This year’s BFA annual conference will run from March 26 to 29 with the theme "Shared Future, Concerted Action, Common Development".

According to authorities, over 2,000 delegates, including government officials, entrepreneurs and scholars from 60 countries and regions came to explore solutions to the current difficulties encountered by economic globalization, such as protectionism and unilateralism, as well as the common challenges faced by both Asia and the world.

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