"Our national security interest dictates that there should be no conflict across the straits," he said.
Schwab, who just returned from a China trip, said he was "struck" by China's immense change.
"I just returned from Beijing and Shanghai. I led the group from the National Committee of American Foreign Policy. We talked to the leadership in Beijing. And what struck me was the sense in Beijing that China is changing very rapidly," he said.
Schwab told Xinhua he did not believe there was any possibility of confrontation between the two countries either in the economic or the military front.
"I don't see this. Not at the present time," he said.
"We tend to compete economically like we compete with the EU countries, but I do not see military confrontation coming. Not now.”
