The political economy of China's exchange rate policymaking in the Hu-Wen era.
The complexity of market and political administration leads to a more sophisticated approach to economic policy formulation and implementation, requiring more professionalism in economic policymaking. The top leaders in the post-Deng era do not have the glowing reputations that the revolutionary leaders like Deng Xiaoping and Chen Yun did, and must rely on institutional rather than personal authority. The new style of economic policymaking is more corporatist than individualistic.
Exchange rate policymaking is of high importance as any adjustment in the exchange rate could influence several sectors of the domestic economy in different ways. It can also have implications for trade and capital flows in the rest of the world, thus creating the need for a high degree of policy coordination. This requires professionalism and institutionalisation in policymaking. Input into policymaking stems from specialists not only within but also outside the bureaucracy, allowing institutional actors to play a significant role in the policymaking process. (2)
The critical role of institutional actors in exchange rate policymaking lies not in their ability to determine either the policy or its implementation, but in their analyses of exchange rate policy issues and policy recommendations,
i.e., policy preparation rather than policy implementation. (3)
[FIGURE 1 OMITTED]
The making of exchange rate policy in China can be described as a three-stage process to be followed in sequence (see Figure 1). The first stage is to collect policy inputs from formal and informal sources, including institutional actors. The second stage is to process and evaluate these inputs by key policy organs before a final decision is made by decision-makers in the last stage. Bargaining among relevant key sectors of the domestic economy takes place before the final decision is reached, given that exchange rate policymaking has an uneven impact on these sectors. Compared to other arenas of economic policymaking, such as energy policy, the bargaining factor in exchange rate policymaking becomes part of policy formulation rather than policy implementation.
Exchange rate policymaking under the Hu-Wen administration is to follow the same institutional process as that in the era of Jiang, allowing for a key role played by institutional actors in policymaking. However, there is clearly a shift in the focus of exchange rate policy from export-oriented to more balanced development. The target for exchange rate policy in the Hu-Wen era is to "maintain the RMB exchange rate basically stable at an adaptive and equilibrium level, so as to promote the basic equilibrium of the balance of payments and safeguard macroeconomic and financial stability". (4)
Useful in understanding China's future foreign exchange reforms, this article examines the political economy of decision-making behind the formation of exchange rate policy in the Hu-Wen era. The next sections analyse structures and processes involved in China's exchange rate policymaking and the making of the 2005 new exchange rate policy through the political economy approach. The final section explores the implications for future developments in the exchange rate policy in the Hu-Wen era.
China's Exchange Rate Policymaking: Leaders, Structures and Processes
China's exchange rate policymaking mechanism from collection of policy inputs to production of policy outputs involves three major types of policy organs: ministries and other institutional actors whose inputs into policymaking are particularly influential, key policymaking organs who gather and evaluate inputs for decision-making and key decision-makers who generate the final policy outputs. Policy elites in these state or party organs play a significant role in contributing to the final decision on particular exchange rate policies.
The precise structure of exchange rate policymaking under Jiang Zemin is shown in Figure 2. This structure includes only key policymaking organs over the period 1998 to 2003. The most important organ in exchange rate policymaking in the Jiang era was the Central Finance and Economics Leading Group (CFELG). (5) It was the final decision-maker in the creation of certain exchange rate policies for China. In the early 1990s, Jiang Zemin was the official chair with Zhu Rong'i his deputy. Zhu chaired the CFELG from 1998 to 2003 when he was Premier of China's State Council. In fact, Zhu was the key decision-maker in exchange rate policy over this period and took charge of all major issues in fiscal and monetary affairs. Wen Jiabao was head of monetary affairs and Secretary General of the CFELG, but did not play an important part in exchange rate policymaking. (6) However, Zeng Peiyan, Jiang's principal economic adviser, was able to push his (and other colleagues') views on exchange rate policy strongly to Jiang, despite being Deputy Secretary-General of the CFELG.
[FIGURE 2 OMITTED]
The Central Financial Work Commission (CFWC) was established on 16 June 1998 to centralise national financial market supervision and restore central policy decisiveness under the huge impact of the Asian financial crisis. (7) The CFWC was a party organ, characterised as the "power centre" of China's financial business. (8) Zhu relied on the CFWC to establish centralised financial control. Part of its responsibilities in exchange rate policymaking was to collect policy inputs and evaluate their feasibility for the CFELG. However, the major role of the CFWC was to push through centralised supervision and regulatory innovations in China's financial industry. Wen was secretary of the CFWC with Yan Haiwang his deputy.
The influence of the People's Bank of China (PBC) over exchange rate policy has grown significantly since China launched the reform and open-door policy in 1979. Its responsibilities were extended beyond regulating the country's financial system to conducting short-term macroeconomic management in 1995 in accordance with the Administration Law of the PBC. The PBC was a very influential source of exchange rate policy input and also a key assessor of inputs from other institutional actors under Jiang. Dai Xianglong, Zhu's right-hand man, succeeded Zhu as governor of the PBC in 1995. (9) Dai was a key figure in exchange rate policymaking and reported directly to Zhu over issues of exchange rate policy formulation. Dai Genyou, head of the CFELG administration office and director of the PBC monetary policy department, was one of the most influential officials in exchange rate policymaking in Zhu's government and his views could reach the CFELG and Zhu directly. The monetary policy department where he served was at the core of exchange rate policy formulation, including policy research, drafting and implementing. The monetary policy committee (MPC) acted as a purely advisory institution and did not have any significant power over exchange rate policymaking at that time. (10)
[FIGURE 3 OMITTED]
[FIGURE 4 OMITTED]
The precise structure of exchange rate policymaking under the Hu-Wen administration from 2003 to 2007 is shown in Figure 3 and the new personnel changes are reflected in Figure 4. The CFWC was dissolved in 2003 when the China Banking Regulatory Commission (CBRC) was formed to take over supervision responsibilities in China's banking institutions. The Communist Party regulation functions in the financial system were then transferred from the CFWC to the state organ, the CBRC. The CFWC and the CBRC are absent from the structure under the Hu-Wen administration. There is a clear division of labour between the PBC and the CBRC as the CBRC took over supervisory functions from the PBC through the National People's Congress (NPC) Standing Committee in 2003. (11) The PBC has therefore dominated other institutional actors in exchange rate policymaking and become the most influential source of exchange rate policy inputs and assessments. Zhou Xiaochuan, governor of the PBC, is one of the key exchange rate decision-makers. Yi Gang and his successor Zhang Xiaohui, secretary-general of the MPC and director of the PBC monetary policy department, have played a significant role in exchange rate policy formulation due to his expertise in monetary economics.
The CFELG is still the final decision-maker on exchange rate policy outputs. Wen took over Zhu's responsibilities as chair of the CFELG after he retired in 2003. Wen is a key figure making final decisions on certain exchange rate policies together with his colleagues. Hua Jiamin, secretary-general of the CFELG with Ma Kai as his deputy was also set to make significant contributions to evaluating policy alternatives and making final decisions. Subsequently, Wang Qishan and Zhu Zhixin have taken over their responsibilities.
The process of exchange rate policymaking goes through initial policy formulation and policy evaluation to final decision-making. In the Hu-Wen era, aside from the PBC, the Ministry of Commerce is an important source of exchange rate policy inputs. The Ministry of Commerce was established in 2003 to formulate guidelines and policies and draft laws and regulations concerning domestic and foreign trade and international economic cooperation. (12) Given the significant impact of exchange rate policy adjustments on the Ministry of Commerce, it is meant to play a large role in initial policy formulation. Zhou Xiaochuan mentioned in an interview with Xinhua that the Chinese government aimed at a rough overall balance in the current account and that this was also a policy followed by the Ministry of Commerce. (13) This demonstrates the need for cooperation between both state organs in exchange rate policymaking. Bargaining occasionally takes place between the PBC and the Ministry of Commerce over certain exchange rate policies. The result of their negotiations will then become a significant source of policy inputs for decision-makers. When reaching the final stage, these policy inputs from ministries are assessed by the CFELG and Wen before they make the decision to generate certain policy outputs.
The Making of the New Exchange Rate Policy in 2005
In 1994, China unified the official exchange rate with the prevailing swap market rate. It then pegged the RMB to the US dollar for over a decade after China abandoned the dual-track exchange rate arrangement. The dramatic rise of China's presence in world markets and its remarkable economic growth over this period drew considerable global attention in terms of an "undervalued" RMB. The dollar-pegged arrangement was considered an "unfair" advantage in explaining the country's increasing competitiveness. (14) Not only did external pressure from the G-7 countries mount on the Chinese administration to revalue the RMB and de-peg the dollar, but this pegged arrangement also caused significant imbalances in the economy: rapid accumulation of foreign exchange reserves and increasing domestic inflation.
Given these complicated internal and external circumstances, the Chinese administration ultimately made the decision to launch a new exchange rate regime in July 2005 after an initial 2.1 per cent appreciation of the RMB against the US dollar, leading to a move from the de facto US dollar-pegged regime to a managed floating regime with reference to a basket of currencies. In accordance with the political economy approach, this can be interpreted as the output of the exchange rate policymaking process to balance interests of domestic key ministries and sectors, together with an account of regional and global interests. Zhou Xiaochuan, governor of the PBC, stated that "China's exchange rate policymaking is mainly founded on its domestic conditions, but also takes into account the regional and global economic conditions". (15)
Policy organs involved in the policymaking process play a large part in collecting and evaluating policy inputs for decision-makers to make a final decision. In the Hu-Wen administration, the key policy organs in exchange rate policymaking are the Ministry of Commerce, the PBC and the CFELG, of which the PBC and the CFELG are the two most influential. Wen Jiabao chairs all major issues in this new policy formulation and implementation as Zhu Rong'i did during the Asian financial crisis in 1998. (16) The new policy package is much more complicated than before and comprises two major issues: the revaluation of the RMB (against the US dollar) and the formation mechanism of the RMB exchange rate.
The Ministry of Commerce is a key player in Chinese exchange rate policymaking as the appreciation of the RMB has a significant negative impact on exports and further lowers the profitability of export-oriented enterprises, some of which are labour-intensive. It was reported that if the RMB were to rise by 3-5 per cent in 2005 in comparison with the US dollar, the growth rate of China's exports might drop to 10 per cent or below; a rise of 15 per cent or more might cause its export growth to go into decline. (17) The fear of these negative repercussions has caused the Ministry of Commerce to take a strong position against a large appreciation of the RMB. Due to differences in industries and cost structures, the influence of RMB appreciation on the Chinese exporters differs among industries. The textile industry has suffered the most. Textiles have always been the largest exporting industry and 50 per cent of Chinese textile products rely heavily on exports. According to one estimate, every 1 per cent appreciation of the RMB against the US dollar will cause a 2-6 per cent drop in textile commodity profits. (18) This industry's gross profit margin and net profit margin in 2005 were around 10.38 per cent and 3.18 per cent, respectively.19 This implies that the Ministry of Commerce would allow for a RMB appreciation of not more than 3 per cent (against the US dollar) in its exchange rate policy proposal. The Chinese Minister of Commerce, Bo Xilai, said that RMB appreciation could put many Chinese enterprises in a difficult situation. (20)
In addition, regarding the formation mechanism of the RMB exchange rate, the Ministry of Commerce is clearly supportive of a gradual move to more flexibility in the RMB exchange rate. Bo has also stated that the completion of a flexible RMB exchange rate mechanism is required to deepen financial system reform in China and will help optimise China's import and export structure and accelerate the transformation of the growth mode of its foreign trade. (21)
The PBC is in a different position from the Ministry of Commerce when it comes to exchange rate policymaking and is also one of the key decision-makers. The major concern of the PBC is with short-term macroeconomic management intended to smooth macroeconomic fluctuations and achieve domestic price stability. RMB appreciation could help repress domestic inflation and cool the overheated economy. The PBC could allow for a relatively higher degree of RMB appreciation. Wei Benhua, Deputy Director of the State Administration of Foreign Exchange (SAFE), a bureau under the PBC, said in an interview that if the RMB appreciated, it should be an increase of less than 10 per cent. (22) This implies that a RMB appreciation of not more than 10 per cent will be suggested in its exchange rate policy proposal.
Zhou Xiaochuan summarised the principles of Chinese exchange rate reform as: independent initiative, controllability and gradual progress. (23) The exchange rate reform objective of the PBC is to ultimately achieve a freely floating exchange rate regime through a sequential approach to achieving more flexibility of RMB movement in response to market demand-supply relations. In its proposal, the PBC could allow for an improvement in the RMB exchange rate flexibility by reforming the de facto US dollar peg regime. The managed floating exchange rate regime was adopted officially by the PBC in 1994 and was more likely to re-exercise in the 2005 exchange rate policy. Zhou pointed out that the goal of the new exchange rate reform was to put in place a managed floating exchange rate regime based on market supply and demand. (24) In addition, the RMB peg to the US dollar was highly disputed and the de-pegging of the dollar must be an option for the PBC, which may have implications for the linkage of the RMB to several major trading currencies, rather than the US dollar alone.
The CFELG makes the final decision on new exchange rate policies. It is a joint party-state policy organ and must take into account overall national interests and also the interests of the Asian region and the international community as a whole. Chinese Premier Wen Jiabao, chair of the CFELG, mentioned at the opening ceremony of the Sixth Finance Ministers' Meeting of the Asia-Europe Meeting that "since the RMB exchange rate reform involves many areas and will have a far-reaching impact, it requires a great deal of preparation to help create the best environment for all sides to deal with the consequences". (25) Wen also stressed that China would choose an exchange rate mechanism and policy suitable to its own national conditions.
Solving unemployment was the first of "three major economic problems" in Wen's policy proposal of "four phases" when he first became Chinese Premier in 2003. (26) A RMB appreciation will have a seriously negative impact on export-oriented domestic enterprises, most of which are labour-intensive. A rise in unemployment contradicts Wen's policy target and causes him to prefer a lower degree of RMB appreciation. Foremost among the "reforms in four aspects" is the reform of the rural economy intended to raise the incomes of farmers. (27) An appreciation will induce large imports of cheaper agricultural products from the rest of the world, which lowers the price of agricultural products and the income of farmers in China. This effect will also induce Wen to opt for a lower appreciation. In addition, he would like, at all costs, to maintain macroeconomic stability in exchange rate policymaking under Wen. He has repeatedly emphasised that exchange rate reform should give consideration to the possible impact on the country's macroeconomic stability and economic growth. (28) A large RMB appreciation is not preferred in this policy context.
However, the new more balanced development model that the Hu-Wen administration proposes intends to promote domestic demand and transform the economic growth model with its reliance on external demand into a model reliant on domestic demand. This strategic adjustment will allow Wen's government to tolerate higher RMB appreciation. With respect to the RMB exchange rate formation mechanism, Wen underlined the need to continue improving the mechanism and develop an exchange rate system that is more market-oriented and more flexible. (29)
Regional and international factors are also of high importance in China's exchange rate policymaking. The decision of no devaluation during the Asian financial crisis was generally explained by placing great emphasis on the role played by international relations. (30) Despite the external pressure from the US and European countries to revalue the RMB, the macroeconomic stability of the Asian region was crucial for Wen's government to make any final decision on exchange rate policy. Wen emphasised that the stable RMB exchange rate was in the interests of economic development not only in China but also in the neighbouring countries and region as a whole, and contributed to the world's financial stability and the expansion of trade. (31) Most Asian countries adopt export-oriented development strategies and work as a production platform to process materials for export to developed countries. The RMB appreciation will no doubt lead to a general appreciation of their currencies, with a detrimental impact on their macroeconomic stability and economic growth. Wen has underlined that China is a responsible country and reform of the RMB exchange rate system had to take into consideration the impact on neighbouring countries, regions and global finance and economy. (32) A stable RMB helped alleviate the strain on China's neighbouring countries and regions and contributed to economic and financial stability and development in Asia during the Asian financial crisis of 1997. Given these regional experiences, a large RMB appreciation will not be favoured. In principle, the new formation mechanism of the RMB exchange rate will also not allow for large fluctuations of the RMB, but will help maintain steady movement in order to achieve regional stability in accordance with Wen's proposal.
The US played a major role in pushing Wen's government to revalue the RMB and de-peg the US dollar. In response to this, Wen Jiabao underlined that the reform of RMB exchange rates was China's business and the politicisation of an economic matter would not be conducive to a solution. (33) Zhou Xiaochuan stated that since China was still a developing country, the impact of China's trade development on other countries' economies and employment should not be exaggerated. (34) However, if domestic conditions permit, China must come to a compromise with the US over this hot issue. It would have the added advantage of persuading the US to deal with other international affairs in a way that will profit China. The new 2005 exchange rate policy is therefore the result of balancing the interests of all sides with an emphasis on domestic conditions, which are political, economic and social.
China's exchange rate policymaking has become institutionalised, which allows institutional actors to play a greater role. Premier Wen Jiabao put forward in the work of his new cabinet in 2003 that China would draw opinions from officials, experts and civilians on major issues to forge a scientific and democratic decision-making system. (35) The decision for a certain exchange rate policy is the result of the exchange rate policymaking mechanism that transforms policy inputs from institutional actors into policy decisions by policymakers.
In the Hu-Wen administration, the PBC will have become the most influential in exchange rate policymaking among domestic institutional actors as China increases its integration with the global economy. The CFELG is expected to remain the key decision-maker of exchange rate policy and rely upon the PBC for expert advice on feasible policies, given the sophistication of exchange rate policymaking and its major external impact on regional and global economies. The PBC will therefore play a joint role in exchange rate policymaking as a policy advisor as well as a decision-maker.
In principle, China's exchange rate policymaking is mainly founded on its domestic conditions, but also takes into account regional and global economic conditions. Given the internal and external impacts of exchange rate policy, a decision on exchange rate policy is made to balance the interests of all sides, placing greater emphasis upon domestic conditions. Wen Jiabao highlighted the importance of the principles of independent initiative, controllability and gradual progress in pursuing the RMB exchange rate reform. (36) By "independent initiative", China is able to independently determine the modality, content and timing of reforms in accordance with its own needs. By "controllability", China intends to properly manage changes in the RMB exchange rate at the level of macro-regulations to prevent large fluctuations in the financial market and economic instability. By "gradual progress", China will push forward reforms step-by-step and take into consideration both present needs and future development, guarding against undue haste.
The Hu-Wen government's objective is to strike a balance between promoting economic growth and improving economic structure, between investment and consumption and between domestic and external demand. (37) Wen Jiabao stressed that China would deepen reform of the financial sector to develop a modern banking system, a comprehensive monetary regulatory mechanism and a multi-tiered capital market, and continue to reform the RMB exchange rate. (38) The target for the RMB exchange rate reform is to "gradually establish a market-based and well-managed floating exchange rate system so as to keep the RMB exchange rate basically stable at a reasonable level". (39)
China has been moving towards a freely floating regime which allows the market to play a full role in exchange rate movements. Wu Xiaoling, a deputy governor of the PBC declared that RMB flexibility was increasing gradually and it would ultimately allow market supply and demand to play a fundamental role in forming the exchange rate. (40) Under the 2005 exchange rate regime, the cumulative appreciation since 21 July 2005 when China discontinued the RMB peg to the US dollar was more than 20 per cent. (41) Although the RMB has already become fully convertible under current accounts since 1996, the long-term target for China is to achieve full convertibility of the RMB under capital accounts. (42) This move requires "a stable macroeconomic situation at home" and "sound domestic financial institutions and markets". (43) Zhou Xiaochuan stated that China always puts the reform of large state-owned commercial banks first to ensure substantial progress in the RMB exchange rate reform, and another condition was that the foreign exchange market must have risk management instruments available to enterprises and financial institutions so that they would be able to protect their interests by using these instruments on the market when the RMB exchange rate floated. (44) He also said that once these were achieved, financial conditions would be mature and it would be time for the central leadership to take action. The 2008 financial crisis created more space for the RMB to play a greater international role and boosted support for China to accelerate the internationalisation process of its currency. (45) Cookson and Dyer believe that the RMB is likely to become the main currency for doing business in Asia in the medium term and become a significant part of the reserves of the world's central banks in the long run once the plan to internationalise the RMB gets going. (46)
(1) Leong H. Liew, "Policy Elites in the Political Economy of China's Exchange Rate Policy-Making", Journal of Contemporary China 13, no. 38 (Feb. 2004): 21-2.
(2) Institutional actors here include ministries, research institutes, consultants, etc.
(3) Liew, "Policy Elites", pp. 22-3.
(4) The People's Bank of China, "Public Announcement of the People's Bank of China on Reforming the RMB Exchange Rate Regime", 21 July 2005 at <http://na.chineseembassy. org/eng/xwdt/t204468.htm> [26 Sept. 2010].
(5) Lu Ning, "The Central Leadership, Supraministry Coordinating Bodies, State Council Ministries, and Party Departments", in The Making of Chinese Foreign and Security Policy in the Era of Reform, ed. David M. Lampton (Palo Alto, CA: Stanford University Press, 2001), p. 47. Lu Ning notes that the Central Finance and Economics Leading Group "has always been the most important organ in economic decision-making".
(6) Liew, "Policy Elites", p. 27.
(7) Sebastian Heilmann, "Regulatory Innovation by Leninist Means: Communist Party Supervision in China's Financial Industry", China Quarterly 181 (2005): 3.
(8) Ibid., p. 2.
(9) Liew, Policy Elites", p. 28.
(10) Ibid., p. 29.
(11) Heilmann, "Regulatory Innovation", p. 19.
(12) See China Ministry of Commerce website at <http://english.mofcom.gov.cn/mission.shtml> [28 Sept. 2010].
(13) "Central Bank Governor on RMB Exchange Rate", Xinhua News, 19 Oct. 2003 at <http://www.chinadaily.com.cn/en/doc/2003-10/19/content_273372.htm> [28 Sept.2010].
(14) Steven Dunaway and Xiangming Li, "Estimating China's 'Equilibrium' Real Exchange Rate", International Monetary Fund Working Paper WP/05/202 (2005), p. 3.
(15) "Central Bank Governor", Xinhua News, 19 Oct. 2003.
(16) Liew, "Policy Elites", pp. 41-50.
(17) "RMB Appreciation Would Affect Exports", Chinanews, 11 May 2005.
(18) "Gains and Pains from RMB Appreciation", Beijing Review, 12 Feb. 2007 at <http://www.bjreview.com.cn/business/txt/2007-02/12/content_55920.htm> [30 Sept. 2010].
(19) Hong Kong Trade Development Council, "Slower Profit Growth Awaits Textiles Industry", 23 Jan. 2006 at <http://www.tdctrade.com/report/indprof/indprof_060105.htm> [30 Sept. 2010].
(20) "How Will RMB Exchange Rate Reform Affect Trade", People's Daily, 2 June 2006 at <http://english.peopledaily.com.cn/200606/02/eng20060602_270674.html> [30 Sept. 2010].
(22) "10% at Most, if RMB Appreciates", Chinanews, 25 Apr. 2005.
(23) "Central Bank Governor on RMB Exchange Rate Reform", People's Daily, 25 July 2005 at <http://english.peopledaily.com.cn/200507/25/eng20050725_198105.html> [10 Dec. 2010].
(25) "Premier Wen Jiabao Strengthened the Asia-Europe Meeting Economic Co-operation", China Daily, 27 June 2005 at <http://english.mofcom.gov.cn/aarticle/counselorsreport/ europereport/200506/20050600135332.html> [10 Dec. 2010].
(26) "Chinese Premier Outlines Objectives and Policies of New Cabinet", Xinhua News, 18 Mar. 2003 at <http://news.xinhuanet.com/english/200303/18/content_785543.htm> [10 Dec. 2010].
(28) "Premier Wen Jiabao", China Daily, 27 June 2005.
(30) Liew, "Policy Elites", p. 41.
(31) "Premier Wen Jiabao", China Daily, 27 June 2005.
(32) "China Not to Yield to Outside Pressure on RMB: Premier Wen", Xinhua News, 16 May 2005 at <http://wwww.chinaembassy.org.in/eng/zgbd/t195911.htm> [10 Dec. 2010].
(34) "Central Bank Governor", Xinhua News, 19 Oct. 2003.
(35) "Chinese Premier", Xinhua News, 18 Mar. 2003.
(36) "Premier Wen Jiabao", China Daily, 27 June 2005.
(37) "A Growing China Embraces A Bright Future", Xinhua News, 6 Sept. 2007 at <http://news.xinhuanet.com/english/2007-09/06/content_6677320.htm> [16 Dec. 2010].
(39) "Premier Wen Jiabao", China Daily, 27 June 2005.
(40) "Chinese Central Bank Reaffirms Policy over Currency", China Daily, 20 Mar. 2006 at <http://ng2.mofcom.gov.cn/aarticle/chinanews/200603/20060301748058.html> [16 Dec. 2010].
(41) "The Exchange Rate of the RMB against the US Dollar Moves from 8.2765 on 21 July 2005 to 6.6227 on 31 December 2010" at <http://www.safe.gov.cn/model_safe/ index.html#> [31 Dec. 2010].
(42) "RMB Convertibility 'Long-term Target'" Xinhua News, 5 July 2004 at <http://www.chinaembassy.org.in/eng/zgbd/t142114.htm,> [16 Dec. 2010].
(43) "Central Bank Governor on RMB Exchange Rate Reform", People's Daily, 25 July 2005.
(45) Since the 2008 global financial crisis, the US dollar has been increasingly weakening whilst the future of the euro is looking uncertain due to the 2010 European sovereign debt crisis.
(46) Robert Cookson and Geoff Dyer, "Currencies: Yuan Direction", Financial Times, 13 Dec. 2010 at <http://www.ft.com/cms/s/0/5b8310f8-06f3-11e0-8c29-00144feabdc0. html#axzz1AEE2nw30> [6 Jan. 2011].
About the author
Jingtao Yi (firstname.lastname@example.org) is Assistant Professor in Economics at the School of Business, Renmin University of China. He received his PhD from the School of Economics at the University of Nottingham. His main research interests are exchange rates, international trade, international business and applied econometrics.
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|Title Annotation:||COMMENTS AND NOTES|
|Publication:||China: An International Journal|
|Date:||Mar 1, 2011|
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