|Chinese Embassy Held Symposium with Foreign Experts on Foreign Exchange Reserve and Financial Security|
On 19 June 2007, the Chinese Embassy invited experts from HSBC, Standard Chartered, Royal Bank of
The reasons for rapid increase of Chinese foreign exchange reserves, existing risks and challenges were analyzed at the symposium. The experts held the opinion that holding large sum of foreign exchange reserves would lead to increasing pressure of RMB's appreciation, rise of international trade frictions, excess liquidity of funds and safety of foreign exchange reserves. The experts pointed out that developed countries also experienced the problems that Chinese economy and finance was facing, and suggested that China draw on the experiences of developed countries such as UK, US and Japan to introduce more market mechanism, lower control gradually, increase transparency, enhance the flexibility of mechanism for forming exchange rate and interest rate as well as broaden foreign investment channels. However, the reform should be proceeded in an orderly and gradual way. The experts also put forward proposals on how to expand investments in
Ambassador Fu Ying thanked the experts for their concern on Chinese economy, considering their opinions and proposals valuable and hoped the two sides will maintain constant communication.