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在线翻译:
szdaily -> Business -> 
Capital account opening ‘must be gradual, steady’
    2018-05-31  08:53    Shenzhen Daily

PEOPLE’S Bank of China Governor Yi Gang said policymakers should press on with efforts to open the financial sector, ease foreign exchange restrictions and gradually relax restrictions on cross-border transactions.

Reaching full capital account convertibility will be a long and slow process, Yi said Tuesday in a speech to the 2018 Annual Conference of Financial Street Forum in Beijing.

He also cautioned against too abrupt an opening, citing Thailand’s 1997 financial crisis. China will ensure that such reforms will be pushed ahead “gradually, steadily,” he said.

“In this new era, our financial sector still has a lot room to open up relative to the requirements of economic and financial development,” Yi said.

“The three reforms — opening up the financial sector to internal and external firms, exchange rate mechanism, and capital account convertibility — have to be coordinated and pushed ahead together.”

Yuan made up 1.62 percent of global transactions in March, down from a high of 2.79 percent in August 2015.

“Yuan internationalization requires steady progress on capital account convertibility,” Yi said.

“If many capital account items are restricted, then the financial sector opening is only in name instead of in reality. Only when our capital account is basically convertible and that our financial sector opens up in both ways, will our currency mechanism and the entire financial sector achieve a coordinated development.”

Guan Tao, former director of the international payments department at the State Administration of Foreign Exchange (SAFE), said yesterday that China’s shrinking current account surplus will not necessarily lead to the depreciation of the yuan,

Guan, speaking on the sidelines of a forum in Shanghai, said he saw limited impact on the yuan from trade friction between China and the United States.

“With different market expectations, capital inflows could compensate the declines in the trade surplus,” said Guan.

He said the reduction of China’s trade surplus with the United States might not equal the amount cut from China’s overall trade surplus as it could increase imports from the United States while decreasing those from other countries.

Therefore, it would not mean the yuan “must depreciate,” he said.

He said international payments would eventually be dependent on the relationship between domestic savings and investment, and changes in the population structure.

Guan took part in major reforms related to the yuan from 1994 in his role at the SAFE.

Guan said he was not pessimistic about the pace of the exchange rate reforms because many supporting measures were in the works.

“Solid progress has been made in supply and demand in the forex market, switches in monetary policy, fending off financial risks, and transformation and upgrading, which paves the way for reforms in future,” he said.

“There has been a change now, the (goal of) yuan internationalization may have been switched from a settlement currency to a pricing currency,” Guan said.

(SD-Agencies)

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