China cautiously hastens capital account reform
Updated: 2013-05-09 12:30
(Xinhua)
|
|||||||||||
BEIJING - China's latest call for an "operational plan" to achieve yuan convertibility under the capital account has raised the prospect of a specific reform timeline, although the government will likely conduct the reform step-by-step rather than all at once, analysts said.
The State Council, or China's Cabinet, said Monday that a plan to make the currency convertible under the capital account will be proposed this year, indicating that a blueprint for the long-discussed reform is in place.
"China should come up with a general target this year and gradually phase in specific measures," said Zong Liang, deputy head of the Institute of International Finance at the Bank of China.
He said he expects the convertibility goal to be achieved by 2020.
Currently, the yuan is convertible for trade purposes under the current account, while the capital account, which covers portfolio investment and borrowing, is still largely controlled by the state over concerns of abrupt capital flows moving in and out of the country.
The timing and speed for opening the capital account, as an important part of the country's intended financial reform and the yuan's internationalization, has resulted in divided views among market analysts, with some suggesting quicker steps and others describing such radical moves as disruptive to the financial market.
"Yuan convertibility under the capital account will hinge on the further liberalization of interest rates and exchange rates, as the distorted price of capital may misguide money flows," said Liu Dongliang, a senior analyst at China Merchants Bank.
Related Stories
China swings back to capital account surplus 2013-04-26 09:40
China revises Q3 capital account deficit data 2012-12-27 09:47
China 'should open up capital account' 2012-11-20 14:24
China to steadily make yuan convertible on capital account 2012-04-11 09:23
Today's Top News
Washington reaffirms defense of ROK
Indian FM kicks off 2-day China visit
China, Israel boost social, economic cooperation
Li calls for sound agriculture
China's CPI grew 2.4% in April
Govt environmental transparency in doubt
Monorail to ease Shanghai's congestion
Bone marrow program to 'spread gifts of life'
Hot Topics
Lunar probe , China growth forecasts, Emission rules get tougher, China seen through 'colored lens', International board,
Editor's Picks
Jaywalkers tread with care |
Old case returns to public eye |
Wetlands a world for birds |
Education: Best days of our lives? |
Property prices continue to rise |
Recalling pain from horror |