CHINA and the US are unlikely to unravel the positive benefits that both countries have reaped through globalisation, Swiss investment bank UBS chairman Axel Weber told CNBC in an interview in Singapore.
Although, Mr Weber admitted that the trade dispute is affecting relationships between the two countries beyond the trade of goods and is having an impact on services.
'As the US is increasingly questioning the openness of trade, the Chinese are increasingly sort of asking questions about services and US firms, in particular financial firms, doing business in China,' he said. 'There's a whole lot of co-mingling of interest at the moment.'
'That is something that we raised multiple times in discussion with the US authorities,' Mr Weber told CNBC. 'That you have to be careful because if you take a holistic picture on goods and service trade, the imbalance is not as pronounced as it appears to be when you just look at goods. And, increasingly, countries look at that holistically.'
Mr Weber added: 'it's not at a stage where it's a trade war. I think there is a good chance that sanity will prevail ultimately.'
One potential area of concern for market watchers is that Beijing could retaliate against the tariff threats from the Trump administration by allowing its currency to continually depreciate against the dollar.
However, Mr Weber dismissed the notion that the drop in the yuan is a big risk in the ongoing trade dispute.
'If you look at investments into China from foreign investors, those foreign investors would be lot more cautious if they fear that the Chinese currency would depreciate in a strategic or in a tactical manner,' he said, adding that based on his conversations with various officials in Beijing, it didn't seem like artificially lowering the yuan was part of the policy.
Although, Mr Weber admitted that the trade dispute is affecting relationships between the two countries beyond the trade of goods and is having an impact on services.
'As the US is increasingly questioning the openness of trade, the Chinese are increasingly sort of asking questions about services and US firms, in particular financial firms, doing business in China,' he said. 'There's a whole lot of co-mingling of interest at the moment.'
'That is something that we raised multiple times in discussion with the US authorities,' Mr Weber told CNBC. 'That you have to be careful because if you take a holistic picture on goods and service trade, the imbalance is not as pronounced as it appears to be when you just look at goods. And, increasingly, countries look at that holistically.'
Mr Weber added: 'it's not at a stage where it's a trade war. I think there is a good chance that sanity will prevail ultimately.'
One potential area of concern for market watchers is that Beijing could retaliate against the tariff threats from the Trump administration by allowing its currency to continually depreciate against the dollar.
However, Mr Weber dismissed the notion that the drop in the yuan is a big risk in the ongoing trade dispute.
'If you look at investments into China from foreign investors, those foreign investors would be lot more cautious if they fear that the Chinese currency would depreciate in a strategic or in a tactical manner,' he said, adding that based on his conversations with various officials in Beijing, it didn't seem like artificially lowering the yuan was part of the policy.