China’s economic growth is bound to slow down due to the trade war and cooling real estate market, but the country is not experiencing a collapse, said Fang Xinghai, deputy director of the China Securities Regulatory Commission, The Paper reported.

Consumption has made a strong contribution to GDP growth, but the government must take action to address housing prices, Fang added.

Fang believes that if the situation worsens, there is still ample room for fiscal policy expansion.

“Many people are worried about China’s debt problems. I think corporate debt is a little too high, but the government can still increase the leverage ratio. Local governments may issue more special bonds, so does the central government,” Fang said.

As for managing fiscal crises, China has a different approach to financial market regulation than other countries – the top-down regulatory system. It has allowed China to avoid major financial crises over the past 40 years, according to Fang.