People's Daily Online -- Premier Wen on principles for RMB exchange rate reform

People's Daily Online -- Premier Wen on principles for RMB exchange rate reformHome >> China
UPDATED: 15:05, June 27, 2005
Premier Wen on principles for RMB exchange rate reform

Chinese Premier Wen Jiabao delivers a keynote speech at the opening ceremony of the Sixth Asia-Europe Finance Ministers' Meeting (ASEM FMM) in Tianjin, a municipality in north China, June 26, 2005.
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Chinese Premier Wen Jiabao said on June 26 that China is entitled to choose its currency (RMB) exchange rate mechanism and policy suitable to its own national conditions.

"It is the common understanding in the world that every country is entitled to choose the exchange rate mechanism and policy suitable to its own national conditions," said Wen in a keynote speech at the opening ceremony of the Sixth ASEM Finance Ministers ' Meeting in the northern China port city of Tianjin.

Back in the early 1990s, China set its targets and tasks for the reform of RMB exchange rate mechanism, which is to gradually establish a market-based and well-managed floating exchange rate system so as to keep the RMB exchange rate basically stable at a reasonable and balanced level, said the premier.

Over the past decade and more, China has done a lot on the reform of the RMB exchange rate mechanism and made important progress, he added.

Wen said keeping RMB exchange rate basically stable at a reasonable and balanced level is in the interests of economic development not only in China but also in neighboring countries and region as a whole.

Wen said maintaining the RMB exchange rate basically stable at a reasonable and balanced level also contributes to the world financial stability and expansion of trade.

"This point was well illustrated during the Asian financial crisis in 1997, when the stable RMB helped alleviate the pain on our neighboring countries and regions and contribute to economic and financial stability and development in Asia and the whole world, " he said at the opening ceremony of the Sixth ASEM Finance Ministers' Meeting in the northern China port city of Tianjin.

Principles for RMB exchange rate reform

Wen said China must uphold the principles of independent initiative, controllability and gradual progress in pursuing RMB exchange rate reform.

"By 'independent initiative,' we mean to independently determine the modality, content and timing of the reform in accordance with China's needs for reform and development," Wen said when addressing the opening ceremony of the Sixth ASEM Finance Ministers' Meeting, held in Tianjin, a port city in north China.

In the exchange rate reform, the premier said, China should take account of its possible impact on the country's macro- economic stability, economic growth and job market, give consideration to the state of the financial system, the level of financial regulations, resilience of the enterprises and effect on foreign trade and keep an eye on the economic and financial performance of the neighboring countries and regions, and of the world as a whole.

"By 'controllability,' we mean to properly manage the changes in RMB exchange rate at the level of macro-regulations. We must push forward the reform but always stay on top of the challenges, so as to prevent fluctuations in the financial market and economic instability."

"By 'gradual progress,' we mean to push forward the reform in a step-by-step manner. We must take into consideration both the present needs and the future development and guard against undue haste."

"In short, we need to continue improving the RMB exchange rate forming mechanism and develop an exchange rate system that is more market-oriented and more flexible."

However, the premier said, since this reform involves a wide range of areas and will have a far-reaching impact, it still requires a great deal of preparation to help create an enabling environment for all sides to sustain the possible impacts.

Such a responsible attitude and practice of China will contribute to the stability and development of not only Chinese macro-economy but also the economy of the surrounding countries and the larger world, the premier said.

By People's Daily Online

People's Daily Online -- Full text of Premier Wen's speech at the Sixth ASEM Finance Ministers' Meeting

People's Daily Online -- Full text of Premier Wen's speech at the Sixth ASEM Finance Ministers' Meeting

Premier Wen Delivers a Speech at the Opening Ceremony of 6th ASEM Finance Ministers' Meeting

Premier Wen Delivers a Speech at the Opening Ceremony of 6th ASEM Finance Ministers' MeetingPremier Wen Delivers a Speech at the Opening Ceremony of 6th ASEM Finance Ministers' Meeting
China pursues gradual reform of RMB rate
Chinese Premier Wen Jiabao said Sunday China must uphold the principles of independent initiative, controllability and gradual progress in pursuing RMB exchange rate reform.



"By 'independent initiative,' we mean to independently determine the modality, content and timing of the reform in accordance with China's needs for reform and development," said the premier when addressing the opening ceremony of the Sixth ASEM Finance Ministers' Meeting, held in Tianjin, a port city in north China.



In the exchange rate reform, the premier said, China should take account of its possible impact on the country's macro-economic stability, economic growth and job market, give consideration to the state of the financial system, the level of financial regulations, resilience of the enterprises and effect on foreign trade and keep an eye on the economic and financial performance of the neighboring countries and regions, and of the world as a whole.



"By 'controllability,' we mean to properly manage the changes in RMB exchange rate at the level of macro-regulations. We must push forward the reform but always stay on top of the challenges, so as to prevent fluctuations in the financial market and economic instability."



"By 'gradual progress,' we mean to push forward the reform in a step-by-step manner. We must take into consideration both the present needs and the future development and guard against undue haste."



"In short, we need to continue improving the RMB exchange rate forming mechanism and develop an exchange rate system that is more market-oriented and more flexible."



However, the premier said, since this reform involves a wide range of areas and will have a far-reaching impact, it still requires a great deal of preparation to help create an enabling environment for all sides to sustain the possible impacts.



Such a responsible attitude and practice of China will contribute to the stability and development of not only Chinese macro-economy but also the economy of the surrounding countries and the larger world, the premier said.



Stable RMB exchange rate in interests of all



Chinese Premier Wen Jiabao said Sunday that keeping RMB exchange rate basically stable at a reasonable and balanced level is in the interests of economic development not only in China but also in neighboring countries and region as a whole.



Wen said maintaining the RMB exchange rate basically stable at a reasonable and balanced level also contributes to the world financial stability and expansion of trade.



"This point was well illustrated during the Asian financial crisis in 1997, when the stable RMB helped alleviate the pain on our neighboring countries and regions and contribute to economic and financial stability and development in Asia and the whole world," he said at the opening ceremony of the Sixth ASEM Finance Ministers' Meeting in the northern China port city of Tianjin.



Policy suitable to national conditions



Chinese Premier Wen Jiabao said Sunday that China is entitled to choose its currency (RMB) exchange rate mechanism and policy suitable to its own national conditions.



"It is the common understanding in the world that every country is entitled to choose the exchange rate mechanism and policy suitable to its own national conditions," said Wen in a keynote speech at the opening ceremony of the Sixth ASEM Finance Ministers' Meeting in the northern China port city of Tianjin.



Back in the early 1990s, China set its targets and tasks for the reform of RMB exchange rate mechanism, which is to gradually establish a market-based and well-managed floating exchange rate system so as to keep the RMB exchange rate basically stable at a reasonable and balanced level, said the premier.



Over the past decade and more, China has done a lot on the reform of the RMB exchange rate mechanism and made important progress, he added.



Proposal on Asia-Europe financial cooperation



Chinese Premier Wen Jiabao Sunday put forward a five-point suggestion to further Asia-Europe financial cooperation at the opening ceremony of the Sixth ASEM Finance Ministers' Meeting (FMM).



Wen firstly suggested Asian and European nations strengthen dialogue and coordination on macro-economic policies, saying it is of great importance for Asian and European countries to regularly exchange economic and policy information through increased dialogue, communication and equal-footed consultation to jointly deal with risks and challenges facing the world economy.



"To promote sustainable and steady development of the world economy, we need to pool our efforts and adopt responsible macro-economic policies to maintain the stability of the major reserve currencies, curb big fluctuations in oil prices and prevent the rise of trade protectionism in all forms," he said.



"The Chinese government proposes to establish an ASEM Contingency Dialogue Mechanism for Emergent Economic and Financial Events within the framework of the ASEM FMM for the purpose of safeguarding economic and financial security," he said.



Secondly, Wen urged countries of the two continents to increase exchanges on development experience.



"We should have in-depth discussions on development paths and strategies and increase exchanges to share experience in regional integration and success stories in macro-economic regulations and restructuring under open conditions," the premier said.



Later this year, China and United Kingdom will co-sponsor a Fiscal Policy and Public Debts Forum within the framework of the ASEM FMM.



"All the finance ministers of Asian and European countries and members of their financial communities are most welcome to take part in this Forum," Wen said.



Thirdly, Wen said he hoped Asian and European nations would deepen substantive cooperation in fiscal and financial sector.



Asian and European countries should actively explore and advance fiscal and financial cooperation between the two continents to develop the Asian regional bond market and support the role of the euro in maintaining international financial stability and promoting development, so as to enhance the international standing of Asia and Europe in the monetary and financial field.



"We should also give full scope to the positive role of the ASEM Trust Fund in assisting the underdeveloped members of ASEM intheir financial reforms," he said.



Fourthly, the Chinese premier suggests Asia and Europe strengthen technical assistance and financial capacity building.



He said, "Given the uneven development between Asian and European countries, we should render greater support to the poor countries in the region through vigorous technical assistance so as to promote the realization of UN Millennium Development Goals."



Lastly, Wen suggests Asian and European nations foster an environment for win-win international economic cooperation.



"We should, through our coordination and cooperation, promote the international community to pay more attention to the interestsof the vast number of developing countries by way of substantially writing off their debts, increasing development aid and speeding up technology transfer."



"We should also facilitate the reform of the international financial and trade systems, promote an early conclusion of the WTO Doha round negotiations and call for innovative thinking in international development so as to establish a sound new international economic order," the premier said.



The Sixth ASEM-FMM, themed to "promote closer Asia-Europe economic and financial cooperation," attracted more than 200 participants from 13 Asian countries, 25 European nations and the European Commission, and representatives from international financial institutions such as the World Bank and the International Monetary Fund.



Enhanced cooperation between Asia, Europe



Chinese Premier Wen Jiabao Sunday urged Asian and European countries to strengthen cooperation in all areas in a bid to lift Asia-Europe cooperation to a new high.



"Asia is by far the most dynamic economy in the world while theEU the world's largest developed economy. Their cooperation to mutual benefit has truly broad prospects," Wen said in a keynote speech delivered at the Sixth ASEM Finance Ministers' Meeting (FMM), which opened here Sunday.



"The founding of ASEM is a strategic choice of Asia and Europe to step up exchanges and cooperation under the new international situation," Wen said, adding that since the first ASEM meeting in 1996, Asia and Europe have been keen to conduct political dialogue, economic cooperation and scientific, technological and cultural exchanges, which has helped the growth of the new ASEM comprehensive partnership and contributed significantly to world peace and common development.



The Chinese premier expressed the belief that the enlarged ASEM, whose member countries have two fifths of the world's population and over half of the world's total gross domestic product (GDP), will play an even greater role in world affairs.



More than 200 representatives from the 39 parties of the ASEM gathered in the northern China port city to attend the one-day Sixth ASEM FMM, the first of an enlarged ASEM, which Wen said would be a good opportunity for participants to explore strategies for ASEM economic and financial cooperation under the new situation and to discuss the major issues in the world economy.



Two documents -- a Chairman's Statement and a Tianjin Initiative on Closer ASEM Economic and Financial Cooperation, are expected to be adopted at the meeting which focuses on the theme to "promote closer Asia-Europe economic and financial cooperation."



China's development poses no threat



China's development is, by no means, a threat to any other countries, Chinese Premier Wen Jiabao said here Sunday at the opening ceremony of the Sixth ASEM Finance Ministers' Meeting (FMM).



"China's development is conducive to the stability and prosperity of our region and peace and development of the whole world, and will not threaten or exert an adverse impact on any country," Wen told Asian and European financial officials at the meeting.



China has achieved sustained and rapid economic growth, markedly enhanced overall national strength and constantly improved people's life since its adoption of the reform and opening-up policy, he said in a keynote speech.



"China's development largely depends on our own efforts, our own vast domestic market, abandonment labor resources and the implementation of the reform and opening-up policy."



Over the past two years, he said, China has taken effective macro-economic measures to address the prominent problems in the economy and the Chinese economy has been in good shape.



The Chinese government will continue to take measures to further tackle the existing problems, with a view to achieving long-term, steady and fast growth of the Chinese economy.



"We are fully confident, capable and resourceful. We can overcome any difficulty and risk on the road ahead and reach our determined magnificent goal of social-economic development," he said.



The Sixth ASEM-FMM, themed to "promote closer Asia-Europe economic and financial cooperation," attracted more than 200 participants from 13 Asian countries, 25 European nations and the European Commission, and representatives from international financial institutions such as the World Bank and the International Monetary Fund.

(Xinhua News Agency June 26, 2005)

CNN.com - China: We won't revalue yuan - Nov 9, 2005

CNN.com - China: We won't revalue yuan - Nov 9, 2005China: We won't revalue yuan

BEIJING, China (Reuters) -- China will not again adjust the yuan exchange rate as it did in July, and will instead let market forces play a main role in setting its value, deputy central bank chief Xiang Junbo was quoted on Thursday as saying.

Chinese officials have repeatedly rejected market speculation of another one-off currency adjustment even though many economists believe July's 2.1 percent revaluation was too modest.

The United States has also continued calling for a stronger yuan. (Bush urges China move)

"In the future, the renminbi (yuan) exchange rate will be mainly decided by market supply and demand and there won't be another one-off official adjustment," Xiang said in a recent speech posted on the central bank's Web site.

China has let the yuan rise by just 0.3 percent against the dollar since it revalued the currency by 2.1 percent in July, even though in theory the yuan can now rise or fall against the dollar by up to 0.3 percent each day.

China would widen the yuan's trading band at an appropriate time, Xiang said, without saying whether he was referring to the closely watched yuan/dollar trading band.

"The People's Bank of China will adjust the renminbi's floating band when the time is appropriate, based on its consideration of the markets as well as the economic and financial situation," he said.

In September the central bank said the yuan's trading band against the dollar was appropriate, soon after it widened the yuan's daily trading band against non-dollar currencies to 3 percent from 1.5 percent.

"We will manage and regulate the yuan exchange rate according to the maturity of the markets and will make improvements towards a more flexible exchange rate regime while keeping the yuan exchange rate basically stable at a rational and balanced level," he said.

But Xiang stressed that the yuan exchange rate alone was not enough to correct the imbalances in China's balance of payments, and called for greater efforts to boost consumption and promote economic restructuring.

China revalued the yuan by 2.1 percent to 8.11 on July 21, scrapping a decade-long peg to the dollar and putting the yuan under a managed float with reference to a currency basket.

Xiang also repeated a pledge that the central bank would keep monetary policy "basically" stable in 2006 by using monetary tools in a flexible way and improve the yuan's mechanism.

Copyright 2005 Reuters. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.

Find this article at:
http://edition.cnn.com/2005/BUSINESS/11/09/us.china.yuan.reut/index.html

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?????????2850???�?????--??--???机构称外汇储备超额2850亿美元 半数进美国

2005年11月16日09:03 【字号 大 中 小】【留言】【论坛】【打印】【关闭】

　　昨日，惠誉评级公司亚洲主权评级主管James Mc Cormack在其一份报告中指出，中国目前至少有2850亿美元的超额外汇储备。

　　报告认为，2005年底中国外汇储备将超过8000亿美元，此后几年内还将保持1600亿美元左右的年流入量，2007年将成为首个外汇储备规模超过1万亿美元的国家。

　　从以下两个指标可以看出中国外汇储备的充足程度。James Mc Cormack表示，目前中国外汇储备为短期债务的7。9倍，为月度进口额的12。6倍。“中国外汇储备是同类国家储备中值的两倍，一般国家外汇储备只需要保证3个月的进口额，或者超过短期外债的3倍左右。”

　　此外，外汇储备规模约为货币供应量M2数据的五分之一，虽然这一占比不高，但是由于国内严格的资本管制，国内资金不会大量流出，因此不必担心有风险发生。

　　惠誉还在报告中称，从明确公布的数据来统计，中国外汇储备大约有2400亿美元投资美国国债，1300亿美元投资美国政府债务，150亿美元左右与国际清算银行相关，而大约3900亿美元资金为目标不明的投资，“其中部分资金可能投资于其他渠道，而其他部分资金可能通过加勒比地区绕道投资于美国。”James Mc Cormack 指出。　（唐昆）

来源：第一财经日报