What China Thinks of US—and China

Vladimir Putin, Prime Minister of the Russian Federation and Wen Jiabao, Premier of the People's Republic of China
swiss-image.ch/Photos by Christof Sonderegger & Sebastian Derungs
Vladimir Putin, Prime Minister of the Russian Federation and Wen Jiabao, Premier of the People's Republic of China

China and Russia are taking the spotlight at this year's WEF. Leaders of both countries opened the forum on Wednesday.

Vladimir Putin tweaked sensibilities in the financial and political worlds by warning against government involvement. And Wen Jiabao went with optimism, especially on his own country's ability to avoid recession.

Looking at both East and West, the Chinese economy will stage a "quick rebound" of economic growth, but the US has a tougher job, facing the loss of $1 trillion in consumption, Zhu Min, executive vice president of Bank of China, told CNBC.com.

"In the States the housing industry has not stabilized" and there will be more deleveraging in the financial and household level leaving no doubt about a recession, he said.

And for the first time in 60 years, you'll see the developed countries contributing zero to the world economy, he added.

Quick government action in China will lead to a quick rebound, and although the economy will slow more in the first quarter, growth of 7 percent to 8 percent is manageable, he said.

As for the change at Davos, he said the last 10 years reflected the US economy—there was a huge party in 2000, it was somber in New York in 2002, there was the theme of power shifting in 2006 and 2007.

Now it looks like "the financial crisis is going to reshape the world."