MANILA - China cannot afford a trade war with the United States because this will significantly impact its economy and may lead to a host of problems, an analyst said on Tuesday.
Frank Umbach, research director at the European Center for Energy and Security, said China cannot afford to have its economy grow below 6 percent because then "the socio-political problems really begin."
Umbach noted that Chinese President Xi Jinping has grand plans for China, which may be derailed if the economy slows down.
"Now that the GDP is slowing down, many of the promises may not be fulfilled," Umbach said in an interview with ANC's Market Edge.
He said he hopes pragmatists prevail on both sides and attempt to find a solution.
The IMF has warned that the US-China trade war poses a risk to global economic growth.