Jack Ma says China and America should think very carefully before starting a trade war.
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Speaking on Wednesday at the World Economic Forum, which is taking place this week in Davos, the CEO of Alibaba (BABA, -0.95%), China’s largest e-commerce company, said that China should give President-elect Donald Trump some time to settle in before reacting to his rhetoric. Ma’s comments came a day after China’s President Xi Jinping proclaimed China’s commitment to free trade in another Davos speech, while seemingly warning Trump against going down the path of protectionism.
“A trade war would be a disaster for the world,” said Ma. “It’s very easy to slip into a trade war.”
Ma met with Trump earlier this month, and in his Davos remarks he called Trump “open-minded.”
While acknowledging China could do better to make its own economy more open, Ma said that Americans should blame themselves, not China, for any U.S. jobs lost.
In a line he has used before, he contrasted Alibaba with Amazon.
com: Alibaba tries to use its technology to empower smaller businesses, Ma said, while Amazon, which Alibaba is often compared to, is trying to own every aspect of its business.
“Amazon is an empire,” said Ma. “We want to build an ecosystem, and help other companies grow to be the next Amazons.”
Still, Ma said that the governments of America and China and the business communities of both countries should do whatever it takes to stop a trade war.
If he faced a choice between keeping his company alive or averting a trade war, “I would shut Alibaba down,” said Ma. “Everyone should do everything they have to to make sure that doesn’t happen.”
“American international companies made millions and millions of dollars from globalisation,” Ma said.
As an example of just how much was available, Ma said, “When I graduated from university I tried to buy a beeper, and it cost me $250. My pay at the time was $10 a month.”
“IBM, Microsoft, the profit they made was larger than the top four banks in China put together. … But where did the money go?”
Ma said that 30 years ago, the American companies that people in China heard about were Ford and Boeing. Today, the companies that people in China talk about are in Silicon Valley and Wall Street.
At the same time, the US spent a lot of money on foreign conflicts. “In the past 30 years, America had 13 wars spending trillion …
no matter how good your strategy is you’re supposed to spend money on your own people,”
Ma said. “The money goes to Wall Street. Then what happened? Year 2008 wiped out $19.2 trillion in US income. …. What if the money was spent on the Midwest of the United States [instead]?”
“The other countries steal jobs from you guys – that is your strategy. You did not distribute the money in the proper way.”
Ma also dropped two other pearls of wisdom. His favourite film is Forrest Gump because he sees something of Alibaba in Gump’s shrimp boat. In the film, according to Ma, Gump says “‘Nobody makes money catching whales, people make money catching shrimps.’ That’s how we make money” at Alibaba.
He also revealed that he wants to retire early: “I don’t want to die in my office,” he said. “I want to die on the beaches.”