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China Balance of Payment Report(First half of 2024) 2025-02-14/en/2025/0214/2281.html
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A recent symposium attended by the director-generals of the branches of the State Administration of Foreign Exchange (SAFE) was held in Hohhot, capital of the Inner Mongolia Autonomous Region. The participants earnestly carried out the decisions and planning of the Party Central Committee and the State Council on the current economic situation and the economic work for the latter half of this year, reviewed and summarized foreign exchange administration work from the beginning of 2010, conducted in-depth analyses of the current economic, financial, and foreign exchange situations both at home and abroad, and studied and mapped out the major tasks for foreign exchange administration during the next stage. Mr. Yi Gang, deputy governor of the Peoples Bank of China and administrator of the SAFE, delivered a work report. Deputy director-generals, chief economists, and chief accountants of the SAFE were also present at the meeting. It was pointed out at the meeting that since the beginning of 2010, the foreign exchange administration departments have earnestly carried out the scientific outlook on development, transformed conscientiously the concepts and methods of foreign exchange administration, promoted progressively reform in major areas and in key aspects of foreign exchange administration, and implemented various tasks according to the established plans. The progress can be encapsulated in the following seven points: (1) Constantly promoting trade facilitation, carrying out pilot reforms of verification and writing-off systems for imports, realizing the transformation from deal-by-deal verification to aggregate inspection, from on-site verification to off-site verification, as well as from behavioral supervision to entity supervision; (2) Launching special intensive campaigns intensively to crack down on the inflow of hot money,by which 3.47 million deals of cross-border transactions involving an accumulated amount of over USD440 billion were examined. So far, 197 cases of suspected regulation violations have been ascertained, among which 150 cases have been filed and 42 have been settled. As to other cases, efforts are being made to determine the nature of the relevant illegal acts in an orderly manner and to impose corresponding penalties; (3) Further improving the transparency of foreign exchange administration, intensifying efforts to integrate and sort out foreign exchange administration laws and regulations, making great efforts to publicize and disseminate basic knowledge about foreign exchange administration, interpreting foreign exchange administration policies, and responding actively to social concerns; (4) Further facilitating foreign exchange receipts and payments and transactions of market entities, streamlining administrative procedures for the examination and approval of foreign exchange businesses under the capital account, carrying out pilot operations of exchange settlements and sales for individuals via e-banking, and providing the Green Channel as a preferential policy for combating earthquakes, carrying out relief work, and ensuring the success of the World Expo 2010 Shanghai; (5) Strengthening the statistics and monitoring of cross-border fund flows, standardizing foreign exchange administration for overseas direct investments by domestic banks, and completing implementation of systems for assessments of bank compliance with the regulations of foreign exchange administration on a nationwide scale; (6) Perfecting the operation and management of foreign exchange reserves, strengthening risk management and internal controls, and constantly enhancing the level of operations and management of foreign exchange reserves; (7) Strengthening the construction of an honest and clean party work style and government, and enhancing internal management and construction of personnel internal control systems. It was pointed out at the meeting that under the macro-economic circumstances both at home and abroad, the first half of 2010 saw relatively brisk foreign exchange receipt and payment activities. On the whole, compared to expectations the appreciation of the Renminbi has been slackening. It is estimated that during the latter half of 2010, the country will still confront a complex situation for foreign exchange receipts and payments, combined with a certain degree of uncertainty. For this reason, efforts shall be made to closely monitor the situation, to carry out in-depth assessments of the risks, as well as to formulate effective programs and measures to cope with the situation. It was proposed at the meeting that during the next stage foreign exchange administration departments at all levels should speed up the transformation of the concepts and methods for the administration of foreign exchange, and make great efforts to promote reform in the major areas of foreign exchange administration. Efforts should be made in the following eight areas: (1) Implementing on a wider scale the reform of the verification and writing-off for imports and exports, earnestly summarizing experiences from the pilot reforms of verification and writing-off of foreign exchange imports, which shall be implemented on a nationwide scale when the essential requirements are satisfied; initiating reform of verification and writing-off of foreign exchange collection from exports with the appropriate timing, and continuing to promote trade facilitation; (2) Continuing to fulfill duties to ascertain and impose penalties on cases ferreted out by the special campaigns to crack down on the inflow of hot money, and maintaining the seriousness of combating hot money; (3) Promoting the integration of data and systems and enhancing the level of comprehensive utilization, monitoring, and analysis of the relevant data, so as to meet the requirements for statistical monitoring, analysis, and early warning, management, inspections, and so forth; (4) Promoting the reform of the capital account with a special focus on selected items required to keep risks under control; (5) Actively promoting the development of the foreign exchange market in coordination with the reform of the RMB exchange rate formation mechanism, studying the addition of transaction instruments that meet the requirements of the market, and strengthening supervision and guidance over market makers; (6) Further improving the transparency of foreign exchange administration and continuing to promote the integration and sorting out of the laws and regulations, so as to perfect the overall legal framework; further enhancing communication with the media and the general public on popular issues of social concern; (7) Strengthening the operation and management of foreign exchange reserves, further expanding and perfecting investment channels and platform construction, and optimizing the currency and capital structure; (8) Implementing the gist of the National Talent Work Conference, continuing to enhance construction of honest and clean party work styles, government, cadre ranks, and control systems. 2010-08-04/en/2010/0804/946.html
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At the end of June 2010, China's outstanding external debt reached USD513.81 billion (excluding that of Hong Kong SAR, Macao SAR, and Taiwan Province), of which the outstanding registered external debt was USD307.21 billion and the balance of trade credit was USD206.6 billion. With respect to the terms, the outstanding long- and medium-term external debt (with the remaining term) was USD170.022 billion, accounting for 33.09 percent of the outstanding external debt. The outstanding short-term external debt (with the remaining term) was USD343.788 billion, accounting for 66.91 percent of the outstanding external debt. Specifically, the outstanding registered short-term external debt (with the remaining term) was USD137.188 billion and the balance of trade credit was USD206.6 billion. In terms of the composition of the debt, trade credit and trade financing (e.g., credit support for foreign trade provided by banks) accounted for 60.10 percent and 18.48 percent of the outstanding short-term external debt (the remaining term) respectively. Together, the two accounted for 78.58 percent of the outstanding short-term external debt (the remaining term). The data are closely related to the dramatic growth of Chinas foreign trade during recent years. Because trade credit and trade financing transactions are conducted based on the real background in foreign trade, they will not result in additional external debt risks. In terms of the types of debtor, the outstanding sovereign debt borrowed by ministries under the State Council was USD38.209 billion, accounting for 12.44 percent of the outstanding registered external debt; the outstanding debt of Chinese-funded financial institutions was USD123.094 billion, accounting for 40.07 percent; the outstanding debt of foreign-funded enterprises was USD95.816 billion, accounting for 31.19 percent; the outstanding debt of foreign-funded financial institutions in China was USD43.806 billion, accounting for 14.26 percent; the outstanding debt of Chinese-funded enterprises was USD5.958 billion, accounting for 1.94 percent; and the outstanding debt of other institutions was USD327 million, accounting for 0.10 percent. In terms of the types of debt, the balance of international commercial loans amounted to USD237.25 billion, accounting for 77.23 percent of the outstanding registered external debt, with the relevant proportion rising by 2.8 percentage points compared with that at the end of 2009. The balance of foreign government loans and loans granted by international financial organizations amounted to USD69.96 billion, accounting for 22.77 percent of the outstanding registered external debt. In terms of the currency structure, the debt in U.S. dollars accounted for 72.10 percent of the outstanding registered external debt, representing an increase of 4.34 percentage points compared with that at the end of 2009. The debt in Japanese yen accounted for 10.11 percent, representing a decline of 1.78 percentage points compared with that at the end of 2009. The debt in euro accounted for 4.51 percent, a decline of1.87 percentage points compared with that at the end of 2009; other kinds of debt including SDRs and HKD accounted for 13.28 percent of the outstanding registered external debt, a decline of 0.69 percentage point compared with that at the end of 2009. In terms of sectors in which the debts were invested, with reference to the Industrial Classification of the National Economy, USD41.467 billion was invested in the manufacturing sector, accounting for 21.58 percent of the medium- and long-term outstanding registered external debt (based on contractual terms); USD24.687 billion was invested in the communications and transportation sector, the warehousing sector, and the postal-services sector, accounting for 12.85 percent of the total; USD17.192 billion was invested in the production and supply of electric power, gas, and water, accounting for 8.95 percent; USD11.771 billion was invested in the information technology services sector, accounting for 6.13 percent; and USD11.038 billion was invested in the real estate sector, accounting for 5.74 percent. From January to June 2010, medium- and long-term external borrowing totaled USD19.776 billion, a year-on-year increase of USD10.443 billion or 111.89 percent. The principal repayment was USD12.395 billion, a year-on-year decrease of USD7.077 billion, or 36.34 percent. The interest payment was USD1.443 billion, a year-on-year decrease of USD641 million, or 30.76 percent. Addendum: Definition of terms and interpretation Trade credit refers to the external liability arising from directly extending credit between the seller and buyer of goods, specifically transactions between residents in Mainland China and foreign non-residents (including non-residents in Hong Kong SAR, Macao SAR, and Taiwan province), i.e., the debt incurred due to the difference between the time of payment and that of the transfer of ownership of the goods. Trade credit includes credit directly provided by the supplier (e.g., the overseas exporter) for commodity transactions and services, and advance payments made by buyers (e.g., overseas importers) for goods, services, and on-going business (or business to be undertaken). Trade financing refers to loans extended by a third party (e.g., banks) related to trade to exporters or importers, for instance, loans extended by foreign financial institutions or export credit agencies to buyers. Trade-related credit is a broad concept. In addition to trade credit, it also includes other kinds of credit provided for trade activities. According to the definition, trade-related credit includes trade credit, trade financing, short-term notes related to trade, and so forth. 2010-10-09/en/2010/1009/954.html
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Q: Recently the PBOC publicized China's balance of foreign exchange reserves at the end of September. There was a substantial increase in the amount of foreign exchange reserves in Q3, 2010. How do you regard this increase? A: At the end of Q3, 2010, China's balance of foreign exchange reserves reached USD2648.3 billion, up USD194 billion as compared with Q2, 2010. During the first half of 2010, the balance of foreign exchange reserves increased by USD55.1 billion from the previous year. The rapid increase in foreign exchange reserves in Q3, 2010 can be ascribed to three factors: (1) China's foreign-related economy continued to grow. In Q3, 2010, the country posted a foreign trade surplus of USD65.3 billion, exceeding the surplus of USD55.3 billion in H1, 2010. China's utilized foreign investment reached USD6.924 billion and USD7.602 billion respectively in July and August of this year. (2) Some large-scale Chinese enterprises initiated public offerings on overseas markets, with large sums of foreign exchange settled by banks. For example, the Agricultural Bank of China raised more than USD10 billion by going public on the Hong Kong stock market. (3) The conversion of currencies and fluctuations in asset prices also contributed to the substantial increase in foreign exchange reserves. The fluctuations caused by changes in non-transactional values such as exchange rates and prices are included in the data publicized by the PBOC. In Q3, 2010, there was an appreciation of major non-dollar currencies, especially the Euro, against the US dollar. The exchange rate of EUR/USD posted an increase of 11 percent in Q3, 2010. The conversion of non-dollar currencies into US dollars and the fluctuations in the prices of assets led to an increase of more than 80 billion US dollars in the countrys foreign exchange reserves. The 15-percent depreciation of the EUR against the USD during the first half of 2010 reduced the increase in Chinas foreign exchange reserves. In addition, the operating income from foreign exchange reserves also contributed to the rapid increase in Chinas foreign exchange reserves. Q: Financial statistical data publicized by the PBOC indicate that in September there was an increase of RMB289.565 billion in outstanding foreign exchange funds. Does this imply a new round of hot moneyinflows? What is your point of view on pressures of fund inflows in China for the foreseeable future? A: Recently there have been comments that hot money is again flowing into China. Such comments are based on the calculation that hot money = newly-increased funds outstanding for foreign exchange surplus in trade utilized amount of foreign investment. Such a method of calculation is unscientific because it neglects the transactional items in the balance of payments, including services, income, portfolio investment, and so forth. Furthermore, it makes comparisons between statistical data of different categories, without specifying the elements and formation mechanisms of the outstanding foreign exchange funds. Thus, the conclusion is untenable, providing misleading information for an understanding of real cross-border fund flows. China will, in the short term, cope with relatively high pressures of fund inflows. The country enjoys high stability of macroeconomic operations, a promising outlook for economic growth, a tendency for the home currency to appreciate, and a strong attractiveness for foreign investment. But there exists some instability in global financial markets and the countrys macroeconomic controls confront problems such as how to manage inflation expectations and how to curb the upsurge in asset prices. These factors may increase the instability of cross-border fund flows through such channels as foreign trade, foreign investment, banks, and so forth. Comprehensive measures are needed for effective control of the risks brought about by the cross-border flow of hot money. Since the beginning of this year, the SAFE has launched a special campaign to struggle against hot money, mainly targeting the penetration of funds via channels with a high degree of openness, such as trade in goods, trade in services, direct investment, and individual transactions. From a long-term perspective, efforts should be made to improve the mechanism for the formation of the RMB exchange rate and to give further play to the fundamental role of the market mechanism to reduce opportunities for arbitrage and speculation by hot money. Efforts should also be made to combat hot money by strengthening collaboration with regulatory departments, keeping a close eye on the major channels of current regulation, and cracking down strongly on various kinds of foreign exchange transactions in violation of the relevant laws and regulations, thereby preventing the inflow of hot money. 2010-10-14/en/2010/1014/957.html
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To further enhance law-based foreign exchange administration and to increase the transparency and convenience of foreign exchange administration, the State Administration of Foreign Exchange (SAFE) recently promulgated a newly-modified List of Administrative Licensing Items of the State Administration of Foreign Exchange (hereinafter referred to as List of Administrative Licensing Items). The List of Administrative Licensing Items shall come into effect as of the date of promulgation. During recent years, the SAFE has made great efforts to carry out the work of constructing the administrative licensing system. A standardized legal framework for administrative licensing was established. Efforts were also made to further standardize the procedures for handling administrative licensing, to streamline administration, to delegate power to lower levels, and to sort out the administrative licensing items. Since 2002, the SAFE straightened out and cancelled 45 administrative approval items in six batches, with the approval authority of more than 20 licensing items delegated to the branches and sub-branches of the SAFE. The List of Administrative Licensing Items issued herein is the latest amendment to the 2005 version based on the progress in straightening out the administrative licensing items during recent years. The number of administrative licensing items has been reduced from 39 to 25. The newly-modified List of Administrative Licensing Items provides a comprehensive and accurate picture of the administrative licensing items currently implemented by the SAFE, as well as the key factors in the relevant procedures. With a clearer presentation, more succinct content, and simplified application materials, the List of Administrative Licensing Items will play an active role in further standardizing the procedures for exchange-related administrative licensing and will increase the transparency of foreign exchange administration. It is explicitly required by the SAFE that all branches and sub-branches of the SAFE shall enhance their sense of responsibility, sense of mission, and sense of urgency in performing their duties regarding the law-based administrative licensing of foreign exchange administration in compliance with the requirements of the new circumstances. They shall enhance awareness of complying with the system, and carry out law-based administration and administrative licensing in a conscientious manner and in strict compliance with the provisions of the Administrative Licensing Law of the PRC, the relevant laws and regulations, and the rules related to foreign exchange administration in an effort to deliver better services to the public. To deepen the reform of the foreign exchange administration system, to increase capital efficiency in domestic enterprises, and to facilitate the trade process, the State Administration of Foreign Exchange recently promulgated the Circular on Launching a Pilot Policy Program for Overseas Deposits of Export Proceeds in Some Regions, to launch a pilot policy program for overseas deposits of export proceeds (hereafter referred to as pilot program) in Beijing, Guangdong (including Shenzhen), Shandong (including Qingdao), and Jiangsu from October 1, 2010. The duration of the pilot program will be one year. The policy involved in the pilot program mainly covers the following: first, the foreign exchange authority shall strictly examine the qualifications of enterprises before granting approval to domestic enterprises to open accounts overseas. The accounts opened overseas shall be used for the deposit of the export proceeds of domestic enterprises from truthful and legitimate transactions, for external payments in goods trade and some services trade, and for external payments under the capital account approved by or registered with the foreign exchange authority; second, the foreign exchange authority will manage the scale of the total capital deposited overseas by domestic enterprises; third, the foreign exchange authority will simplify the formalities for import and export write-offs and online inspections, and implement an ex post facto reporting system for enterprises and banks; fourth, the foreign exchange authority will conduct off-site monitoring of the receipt and payment activities of the domestic enterprisesoverseas accounts and on-site inspections of any abnormalities in the monitoring process. The pilot program for overseas deposits of export proceeds is a productive attempt to complete the existing system for the administration of foreign exchange trade receipts and payments: on the one hand, it diversifies the means of adjusting the balance of payments; on the other, it paves the way for capital operations by domestic enterprises; for enterprises frequently involved in the balance of trade, it helps lower expenses and exchange settlement costs for cross-border transfers of capital in foreign exchange; for enterprises mainly competing in the international market and strong in group management, it helps improve the capital efficiency, lower overseas financing costs, and thus strengthen their competitiveness in the international market. 2010-08-27/en/2010/0827/950.html
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According to statistics from the State Administration of Foreign Exchange (SAFE), from January to March 2010, bank settlements of foreign exchange for clients were USD94 billion in January, USD76.3 billion in February, and USD100 billion in March respectively; the total was USD270.3 billion. Bank sales of foreign exchange for clients were USD53.8 billion in January, USD54.5 billion in February, and USD69.3 billion in March; the total was USD177.6 billion. The balance between bank settlements and sales of foreign exchange for clients was USD40.2 billion in January, USD21.8 billion in February, and USD30.7 billion in March, resulting in a total surplus of USD92.7 billion. During the period from January to March 2010, domestic banks foreign-related collections for clients were USD132.3 billion in January, USD108.1 billion in February, and USD141.8 billion in March respectively; the total was USD382.2 billion. External payments by domestic banks for clients were USD102.1 billion in January, USD93 billion in February, and USD125.80 billion in March; the total was USD320.9 billion. The balance between domestic banks foreign-related collections and payments for clients was USD30.2 billion in January, USD15.1 billion in February, and USD16 billion in March, resulting in a total surplus of USD61.3 billion. Glossary and relevant definitions The Balance of Payments refers to all economic transactions occurring between residents and non-residents in China, including all financial transactions and barter resulting in changes in the assets and liabilities of residents and non-residents. Bank Settlement and Sales of Foreign Exchange for Clients refers to settlement and sales services of foreign exchange provided by designated foreign exchange banks for their clients, exclusive of settlement and sales of foreign exchange conducted by designated foreign exchange banks for themselves and transaction data on the inter-bank foreign exchange market. Statistics on bank settlement and sales of foreign exchange for clients are conducted at the time of the exchange of the RMB and the foreign currency. Specifically, settlement of foreign exchange is the process by which the owner of the foreign exchange sells exchange to designated foreign exchange banks; the sale of foreign exchange is the process by which exchange is sold by the designated foreign exchange banks to the users of foreign exchange. The balance between the settlement and sales of foreign exchange is the offset balance between the settlement and sales of foreign exchange, which will be balanced by the banks through bank transactions on the inter-bank foreign exchange market. This is the major cause of changes in the amount of foreign exchange reserves, which is not equivalent to the net change in foreign exchange reserves during the same period. The bankssettlements and sales of foreign exchange for clients are not counted in compliance with the principle applicable to the transactions between residents and non-residents, which only include the transactions between banks and their clients in domestic and foreign currencies, i.e., the exchange and transactions between RMB and foreign exchange. Their statistical scope differs from the transactions under the balance of payments. Foreign-related Collections and Payment by Banks for their Clients refers to the collection and payment occurring between domestic non-bank resident institutions/individuals (collectively called the non-bank section) and non-resident institutions/individuals through domestic banks, which are exclusive of the collection and payment in cash and foreign-related collections and payments by the banks themselves. They include: cross-border collections and payments between non-bank sections and non-residents through domestic banks (including RMB and foreign exchange), and domestic collections and payments between non-bank sections and non-residents through domestic banks (currently including collections and payments in foreign exchange and collections and payments in RMB under the RMB settlement item for cross-border trade). The statistics are collected at the time when the clients conduct foreign-related collections and payments at domestic banks. Specifically, the foreign-related collections by banks for their clients refer to funds collected by non-bank sections from non-residents via domestic banks; the banksexternal payments for their clients refer to the funds paid by non-bank sections to non-residents through the domestic banks. Although foreign-related collections and payments by banks for their clients constitute an integral part of the balance of payment statistics, in principle they differ from the balance of payment statistics. The capital receipt and payment system is the statistical principle for banksforeign-related collections and payments for their clients, whereas the accrual basis is the statistical principle for the balance of payments. The banksforeign-related collections and payments for their clients only reflect cash flows between domestic non-bank sections and non-residents and do not reflect the barters and foreign-related transactions conducted by the banks themselves, and their statistical scope is smaller than that of the balance of payments. 2010-09-20/en/2010/0920/952.html
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According to the statistical data released by the State Administration of Foreign Exchange (SAFE), in July 2010 foreign exchange settlement and sales by banks on behalf of clients amounted to USD114.2 billion and USD87.6 billion respectively. The surplus of foreign exchange settlement and sales amounted to USD26.6 billion. During the month of July 2010, foreign-related receipts and payments of domestic banks on behalf of clients amounted to USD162.2 billion and USD134.6 billion respectively. The surplus of foreign-related receipts and payments reached USD27.6 billion. Annex: Definition of terms and interpretation Balance of payments (BOP) refers to all economic transactions occurring between residents and non-residents in China, including all financial transactions and barter transactions resulting in any changes to assets and liabilities thereof. Foreign exchange settlement and sales by banks on behalf of clients refer to foreign exchange settlement and sales conducted by designated foreign exchange banks for their clients, excluding data on foreign exchange settlement and sales conducted by designated foreign exchange banks on their own behalf and data on inter-bank foreign exchange market transactions. The time of conversion between Renminbi and foreign currency is regarded as the time-point for the statistics. Specifically, foreign exchange settlement refers to the sale of foreign exchange to designated foreign exchange banks by owners of foreign exchange; foreign exchange sales refer to the sale of foreign exchange by designated foreign exchange banks to users of foreign exchange. The differences between foreign exchange settlement and sales are regarded as an offset balance, which will be balanced by the banks through transactions on the inter-bank foreign exchange market. This is the major reason for changes in the amount of foreign exchange reserves, which is not equivalent to the net change in foreign exchange reserves during the same period. The principle for transactions between residents and non-residents does not apply to the preparation of statistics on foreign exchange settlement and sales by banks on behalf of clients, and such statistics only cover transactions of RMB and foreign currencies between the banks and their clients, namely, exchange transactions between RMB and foreign currencies, which fall outside the category of the balance-of-payments statistics. Foreign-related receipts and payments of banks on behalf of clients refer to receipts and payments occurring between domestic non-bank resident institutions and individuals (collectively called the non-bank sector) and non-resident institutions and individuals through domestic banks, which are exclusive of the receipts and payments in cash and foreign-related receipts and payments by the banks themselves. They include: cross-border receipts and payments between non-bank sectors and non-residents through domestic banks (including RMB and foreign exchange), and domestic receipts and payments between non-bank sectors and non-residents through domestic banks (currently including receipts and payments in foreign exchange and receipts and payments in RMB under the RMB settlement item for cross-border trade). Statistics are collected at the time when the clients conduct the foreign-related receipts and payments at the domestic banks. Specifically, foreign-related receipts of banks on behalf of clients refer to funds collected by non-bank sectors from non-residents via domestic banks; external payments by banks on behalf of clients refer to the funds paid by non-bank sectors to non-residents through domestic banks. Although foreign-related receipts and payments of banks on behalf of clients are an integral part of the balance-of-payments statistics, the accounting method for the statistics, different from the accrual basis of accounting required by the balance of payments statistics, is based on a cash basis. In addition, it merely reflects fund flows between the non-bank sectors and non-residents, and does not include the barter transactions and foreign transactions conducted by the banks themselves. Furthermore, the scope of the statistics on the foreign-related receipts and payments of banks on behalf of clients is smaller than the scope of the balance-of-payments statistics. 2010-09-01/en/2010/0901/951.html
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With the rapid development of Chinas foreign-related economy and the increasing cross-border interactions by individuals, bank cards, as a safe and convenient mode of payment, have gained growing popularity for cross-border consumption. In order to improve the management of foreign currency bank cards and to familiarize the public with the relevant management policies, the State Administration of Foreign Exchange (SAFE) recently promulgated the Circular on Regulating the Administration of Foreign Currency Bank Cards (Huifa No.53 [2010], hereafter referred to as the Circular). The Circular will come into force as of November 1, 2010. According to the Circular, the four original laws and regulations on foreign exchange administration with regard to foreign exchange bank cards have been integrated into one set of laws. Meanwhile, the fundamental principle for the management of bank card-related foreign exchange businesses is specified in three respects: (1) insistence on the convertibility of the current account; both residents and non-residents are allowed to use their bank cards for cross-border consumption for tourism, services, etc; (2) the use of domestic bank cards outside of China shall be subject to the management rules of the merchant category codes; cash withdrawals outside of China shall be conducted within the prescribed amounts, and shall be handled by the card-issuing financial institutions or the bank card organizations in charge of the transfer; (3) the relevant authorities shall keep records on bank card transactions, monitor and track abnormal transactions efficiently, and investigate and deal with illegal acts and non-compliance with the regulations in a timely manner. With reference to the working practices in recent years, the Circular has made adjustments to the limit of withdrawals of RMB in cash at ATM by foreign cards within China, viz. each transaction shall not exceed RMB3000. The Circular will play an active role in enhancing the transparency of the laws and regulations on the administration of foreign exchange, enabling the public and the banks to better understand and carry out the relevant regulations on foreign exchange administration so as to facilitate the use of bank cards by the public for cross-border interactions. As a result, larger amounts of foreign-related transactions will be conducted within the bank system and greater transparency of the foreign-related economy will be achieved. 2010-10-11/en/2010/1011/955.html
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In order to improve administration of the bankssynthetic positions in foreign exchange settlement and sales and to facilitate the conduct of the relevant business by banks, the State Administration of Foreign Exchange (SAFE) recently promulgated the Circular on Relevant Issues concerning the Administration of the BanksSynthetic Positions in Foreign Exchange Settlement and Sales (Huifa No. 56 [2010]) (hereinafter referred to as the Circular). The circular shall come into force as of the date of promulgation. This Circular collates and integrates the 7 normative documents pertaining to the administration of bankssynthetic positions in foreign exchange settlement and saleshereinafter referred to as the positions . In the Circular, the principles for the administration of the positions are defined, including unified ratification of legal persons, limited management, management on an accrual basis, examination and regulation on a daily basis, and regular reconciliation against the accounting subjects; specific management requirements for the positions have also been further clarified concerning the position application, adjustment, and ratification, as well as the submission of the relevant data on the positions; moreover, the management requirements have been integrated with regard to application of balance controls in the special RMB accounts for foreign exchange settlement and sales to foreign-funded banks which have not opened RMB business, and in the centralized management of the positions of the branches of foreign banks. As of the date of issuance, the limits of the banks existing position remain unchanged. The Circular will play an active role in improving the transparency of laws and regulations on the administration of foreign exchange and simplifying management processes, thus enabling banks to better understand and implement the relevant regulations. As a result, the foreign exchange settlement and sales business and the relevant business activities will be carried out in an orderly manner. 2010-10-20/en/2010/1020/958.html
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In Q2 of 2010 the current account and the capital and financial account continued to post a "twin surplus" and international reserves maintained growing momentum. China's surplus under the current account totaled USD72.9 billion, an increase of 35 percent year on year. Specifically, according to the statistical coverage of the balance of payments, the surpluses in goods, income, and current transfers reached USD59.5 billion, USD8 billion, and USD9.9 billion, respectively, whereas the deficit in trade in services amounted to USD4.5 billion. Meanwhile, China's surplus under the capital and financial account totaled USD25.8 billion, a decrease of 68 percent year on year. In particular, the net inflows of direct investments and other investments amounted to USD21.5 billion and USD12.4 billion respectively, whereas the net outflows of portfolio investments reached USD9.5 billion. International reserve assets posted an increase of USD82.1 billion, a drop of 17 percent year on year as calculated on a comparable basis. Specifically, transactions in foreign exchange reserve assets registered an increase of USD81.1 billion (exclusive of the influence of non-transaction value change factors such as exchange rates and prices) and the reserve position in IMF registered an increase of USD900 million. In the first half of 2010, China's surplus under the current account totaled USD126.5 billion, a decrease of 6 percent year on year. Meanwhile, China's surplus under the capital and financial account totaled USD90 billion, an increase of 48 percent year on year. International reserve assets posted an increase of USD178 billion, a rise of 8 percent as calculated on a comparable basis. In addition, the BOP Analysis Team of the SAFE released China's Balance of Payments Report for the First Half of 2010 in order to facilitate an understanding of the data and analysis of China's balance of payments among all social groups. 2010-10-12/en/2010/1012/956.html