Yuan Convertible Within 15 Years: PBOCThe government's 1993 goal to have free convertibility of renminbi in capital accounts may be realized by 2015, announced China's central bank, the People's Bank of China (PBOC).Yi Gang, deputy secretary-general of PBOC's Monetary Policy Committee and deputy director of the Monetary Policy Department, stated that convertibility in current accounts would take about 10 years to achieve, following international practice. PBOC President Liu Mingkang confirmed that renminbi couldn't realistically be freely convertible until 2010. Dai Xianglong, PBOC governor, pointed out that although there is no timetable, efforts are being made. For instance, convertibility of renminbi in current accounts was allowed by the Chinese government in December 1996. Yi Gang noted that in certain circumstances, convertibility could gradually progress. He recommended the adoption of policies and guidelines that would promote this process. Specifically, control would be initially relaxed over long-term capital flow, direct investment, overseas financing and financial institutions. The lifting of control for short-term capital flow, indirect investment, domestic nonresident financing, and for nonfinancial institutions and individual residents would eventually follow. |
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