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Jin pledges further exchange rate reform
By Chuan Yu (China Daily)
Updated: 2005-10-15 09:22
China's finance minister pledged on Friday to press ahead with its exchange
rate regime reform, while calling upon developed countries to increase their
contributions to global issues like poverty reduction.
Responding to questions after meeting with his British counterpart, Jin
Renqing said: "We have been reiterating our exchange rate reform target - that
we aim to establish a market-based managed floating exchange rate system, and
maintain exchange rate stability at an appropriate level."
He added: "We have taken a very important step, and we will continue with the
reform step by step."
China announced a reform to its decade-old exchange rate policy of the
renminbi, or yuan, on July 21, dropping the peg to the US dollar and basing the
currency value on a basket of currencies instead.
The currency was also allowed to rise by 2 per cent against the US dollar,
which was welcomed by China's trading partners that have been pushing for a yuan
appreciation, although the nation has stressed higher value of the yuan will not
solve global trade imbalances.
"We welcome the progress made in China," said Gordon Brown, Britain's
Chancellor of the Exchequer, after stressing that all continents should do their
bit in maintaining global stability that is being threatened by soaring oil
prices and other changes.
The two ministers launched a joint paper entitled Responding to Global
Economic Challenges yesterday, setting out the opportunities and challenges
presented by rapid economic change, and the appropriate response at a national,
regional and global level.
The paper proposed domestic policies that are key to maximize the benefits of
globalization, including establishing macroeconomic stability through sound
fiscal and monetary frameworks and facilitating the growth of a flexible and
entrepreneurial business sector.
It also called for efforts at an international level, in such areas as
promoting trade openness rather than protectionism and working to eliminate
poverty and achieve the United Nations' Millennium Development Goals, which
require developed countries to fulfill their commitments to mobilize aid and
debt relief.
"We hope developed countries can reduce agricultural subsidies, we hope they
can meet the requirements of the Millennium Development Goals and provide more
funding support to developing countries," said Jin.
"And we hope developing countries can formulate policies that better support
their own development," he added.
The officials also highlighted achievements in bilateral financial
co-operation. Noting Sino-UK strategic co-operation is in its best era in
history, Jin expressed confidence in meeting a bilateral trade target of US$40
billion by 2010, as envisioned by Chinese Premier Wen Jiabao.
"Bilateral trade was close to US$20 billion last year, and we will likely
have US$25 billion this year," he said. "Reaching US$40 billion in 2015 is
absolutely achievable, and the potential might well be more than
that."
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