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Monday, November 12, 2001, updated at 09:04(GMT+8)

China to Further Promote Financial Reform

The spokesman of the People's Bank of China said Sunday in Beijing that the entry into World Trade Organization (WTO) will bring both opportunities and challenges to the banking industry.


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The spokesman of the People's Bank of China said Sunday in Beijing that the entry into World Trade Organization (WTO) will bring both opportunities and challenges to the banking industry.

He said China will abide by the opening-up policy in banking industry and promote financial reform, in order to sharpen the competitive edge of domestic banks.

Under WTO agreements, China will gradually remove the limitations of foreign banks, he said. After the formal entry, the foreign banks can deal with foreign currency to Chinese-funded companies and Chinese inhabitants.

Meanwhile the foreign banks will be allowed to deal with Chinese yuan gradually. And these banks will be able to provide loans to Chinese car buyers in five years, he said.

The spokesman pointed out that the opening of the banking industry will improve the capital structure of the domestic banks, attract more international capital and improve China's management and service.

By the end of September, there were nearly 190 branches of foreign banks in China, mainly located in Shanghai, Shenzhen, Beijing, Guangzhou, and Tianjin. The total assets of the foreign banks reached 44 billion US dollars, with 18.6 billion worth of loans and 6.5 billion worth of savings.

The spokesman said that challenges are inevitable after the entry into WTO. Chinese banks will see fierce competition in terms of attracting qualified customers and skilled financial personnel, and expanding new business.

He added that Chinese banks will be capable of growing so as to keep up with the demands of the reforms.

The spokesman said that the impact on Chinese different departments after the entry will also influence the financial control and supervision, but that China can maintain its

financial stability.






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