City maps out primary issues
By Zhang Fengming |
January 27, 2010, Wednesday
|
Print Edition
Print Edition
THE Shanghai headquarters of the People's Bank of China has identified stable credit growth, financial innovation and deepening cross-border trade settlement in the yuan among its work priorities this year.
The central bank will further extend the trial of cross-border trade settlement in the yuan in Shanghai to facilitate trading, the local headquarters of the central bank said yesterday.
The yuan settlement helps stabilize trade, trim currency exposure of exporters and build up the yuan's position in the international monetary system, which now centers on the United States dollar.
In April 2009, China allowed Shanghai and four cities in Guangdong Province to settle trade in yuan with businesses in Hong Kong, Macau and the 10-member Association of Southeast Asian Nations on a trial basis. Shanghai started the program in the middle of last year. Previously, Chinese companies had to convert yuan into US dollars or other currencies to settle international trade.
The PBOC will further streamline the management of foreign currencies. It will also tighten scrutiny to prevent irregular cross-border capital flow and illegal banking.
Banks should pace their credit reasonably and avoid a surge in credit. They should be prepared to stop credit to industries suffering from overcapacity and instead to support the real economy by channeling capital to strategic industries, high-tech sectors, innovative companies and low carbon sectors, the PBOC said. Its requirement is similar to the one by the Shanghai Bureau of the China Banking Regulatory Commission, the banking regulator.
More financial innovations are planned as Shanghai bids to develop into a global financial hub. They include pushing forward the bond market for smaller business to expand their financing channels and introducing more gold products.
The central bank will further extend the trial of cross-border trade settlement in the yuan in Shanghai to facilitate trading, the local headquarters of the central bank said yesterday.
The yuan settlement helps stabilize trade, trim currency exposure of exporters and build up the yuan's position in the international monetary system, which now centers on the United States dollar.
In April 2009, China allowed Shanghai and four cities in Guangdong Province to settle trade in yuan with businesses in Hong Kong, Macau and the 10-member Association of Southeast Asian Nations on a trial basis. Shanghai started the program in the middle of last year. Previously, Chinese companies had to convert yuan into US dollars or other currencies to settle international trade.
The PBOC will further streamline the management of foreign currencies. It will also tighten scrutiny to prevent irregular cross-border capital flow and illegal banking.
Banks should pace their credit reasonably and avoid a surge in credit. They should be prepared to stop credit to industries suffering from overcapacity and instead to support the real economy by channeling capital to strategic industries, high-tech sectors, innovative companies and low carbon sectors, the PBOC said. Its requirement is similar to the one by the Shanghai Bureau of the China Banking Regulatory Commission, the banking regulator.
More financial innovations are planned as Shanghai bids to develop into a global financial hub. They include pushing forward the bond market for smaller business to expand their financing channels and introducing more gold products.
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