It is necessary for China to orderly reduce its holdings of the United States' Treasury bonds, given the fast expansion of US net foreign liabilities and the low coupon rate of its Treasury bonds, said Yu Yongding, an academic member of the Chinese Academy of Social Sciences, at the Annual Conference of China International Finance Society held on Thursday.

"Facing the weaponized US dollar, China must try its best not to be a creditor of the US. For that, we should return the 'I-owe-yous' issued by the US as much as possible to it and exchange them for the actual resources we need," Yu said, adding that requires China to maintain trade balance and achieve equilibrium in the international balance of payments.

He said China must seize the opportunity to improve overseas asset-liability structure and increase the return on overseas net assets, which means China should reduce the proportion of foreign exchange reserves in overseas assets.

"China also needs to improve the safety of overseas assets, especially that of foreign exchange reserves, and reduce foreign exchange reserves to the internationally recognized level of reserve adequacy," he said.

The fundamental way to optimize the structure of the overseas investment positions and the structure of the international balance of payments is to pursue the dual-circulation development pattern, Yu said, adding the country should expand fiscal and monetary policies to stimulate economic growth and therefore increase imports, which will help achieve equilibrium in the international balance of payments and optimize the structure of overseas investment positions.

Ge Haijiao, chairman of Bank of China, said at the conference that the uncertainties faced by the global economy remain significant, although the impact of the COVID-19 pandemic on social operations is gradually fading.

"Development is the fundamental way to solve all problems, and openness and cooperation are the necessary paths to achieve prosperity and development," Ge said, who is also president of the China International Finance Society.

The opening-up and innovations of China's financial industry have injected many positive factors into the world economy. In the future, the global financial industry needs to strengthen cooperation in innovating financial cooperation models, improve investment and financing mechanisms, and stimulate new momentum for global economic growth, Ge said.

The world needs to strengthen international policy coordination, reduce the spillover of cross-border risks, and promote the construction of a new global economic and financial governance system that upholds cooperation and win-win principles and can solve problems rising from the fragmentation of the current global economic and financial governance system, he said.