Stable RMB exchange rate conducive to stability in region, world: China

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Last updated at: (Beijing Time) Wednesday, September 24, 2003

Stable RMB exchange rate conducive to stability in region, world: China

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The stability of the Chinese currency Renminbi (RMB) exchange rate is conducive to stable economic and financial development not only in China but also in the region and the world, said Chinese Finance Minister Jin Renqing Tuesday in Dubai.

Jin made the remarks at a joint discussion of the World Bank Group and International Monetary Fund annual meetings, which formally kicked off in the Gulf emirate of Dubai earlier in the day.

The Chinese government has always held a serious and responsible attitude toward the issue of RMB exchange rate, Jin said.

"Since the eruption of the 1997 Asian financial crisis, the stability of RMB exchange rate has not only enhanced China's economic and financial stability, but also contributed to the financial and economic stability in the Asian region and the world," the Chinese finance minister said.

A country's foreign exchange regime should be determined by its economic development stage, its financial regulatory capacity, and the solvency of enterprises, he said.

"The market-based, single, managed floating exchange regime as adopted by China complies with China's fundamentals," Jin added.

"In tandem with deepening financial reform, the Chinese government will further improve the mechanism of RMB exchange rate, prudently liberalize capital account, gradually relax the constraints on using foreign currencies by firms and residents and closely monitor and adjust balance of payment," he told delegates from 184 countries.

Chinese economy steps on new growth stage: Finance Minister

China's economy has stepped on a new growth stage with its opening up to the outside world broadening room for further economic growth, Chinese Finance Minister Jin Renqing said Tuesday.

Addressing the plenary session of the World Bank Group and International Monetary Fund (IMF) annual meetings, which formally kicked off in the Gulf emirate of Dubai Tuesday, Jin said the intrinsic vitality of China's economy has been remarkably enhanced, and a number of new growth points are emerging in automobile, real estate, electronics and telecommunications sectors.

Despite the unfavorable external environment and the outbreak of SARS, the Chinese economy has maintained higher growth, he said.

In the first half of 2003, China's GDP grew by 8.2 percent, compared to the same period of last year. The projected target of seven percent annual growth will be achieved, he told the delegates attending the opening session.

In order to achieve the overall objective of maintaining stable economic growth, the Chinese government will continue to stimulate domestic demand, ensure the continuity of macroeconomic policies and push forward reforms to address problems inherited in economic system, he said.

"Emphasis will be given to rural development, corporate and financial restructuring, and government institutional improvement," he added.

On the role of the World Bank and IMF in promoting sustainable economic development, the Chinese finance minister said the mandate of the World Bank is to promote economic growth, reduce poverty by transferring real resources and achieve equitable global economic development.

"To meet this goal, the Bank should stick to its mainstream business by providing investment loans to clients countries and scale up effort to support infrastructure action plan."

He noted that the IMF continues to play a irreplaceable role in promoting monetary cooperation among its members and maintaining global financial stability.

"China appreciates the work of the Fund in crisis prevention and resolution, and encourage the Fund continue to help low-income countries in debt reduction and economic recovery."

The Chinese finance minister also urged developed countries to increase development assistance to developing countries.

"The inadequacy of official development assistance (ODA) is a big hurdle in achieving Millennium Development Goals (MDGs).

"The reduction of trade barriers by developed countries, especially in the area of agriculture subsidies, holds the key for the success of Doha development round," he said.

"China hopes that all parties will make concerted efforts to promote the trade talks. Developed countries, in particular, should take due responsibility to abandon trade protectionism, lower barriers and further open up their markets," the Chinese minister said.

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