The national foreign exchange administration work conference has been recently held in Beijing. At the conference, participants studied, promoted and implemented the spirit of the 19th CPC National Congress, the Central Economic Work Conference and the National Financial Work Conference, summarized the performance of foreign exchange administration over the past five years, studied the foreign exchange market conditions and concerns in foreign exchange, studied the logics and arranged for assignments regarding the foreign exchange administration reform for the moment and the near future. Pan Gongsheng, Secretary of the Party Leadership and Administrator of the State Administration of Foreign Exchange (SAFE), delivered a work report.  

The conference pointed out that under the leadership of the CPC Central Committee with Comrade Xi Jinping at its core and the guidance of the CPC Committee of the People's Bank of China, foreign exchange authorities have strengthened the Party's self-discipline, established and executed the new philosophy on development and deepened the foreign exchange administration reform over the past five years, based on the work arrangements of the CPC Central Committee and the State Council. They have further liberalized the foreign exchange market, supported the development of the real economy, and effectively tackled the impact on the foreign exchange market, maintaining the economic and financial security of the country. First, foreign exchange authorities have been committed to foreign exchange administration reforms and innovations. They have deepened the reform of delegation, regulation and service, achieved new progress in the capital account convertibility and the two-way liberalization of the financial market, pushed the liberalization and competitiveness of the foreign exchange market to new highs, and further enhanced cross-border trade and investment liberalization and facilitation. Second, foreign exchange authorities have prevented the risks arising from cross-border capital flows. They have improved the macro-prudential management of cross-border capital flows and micro-regulatory framework of the foreign exchange market. They have maintained a tough stance on foreign exchange irregularities to safeguard the healthy and orderly foreign exchange market. Third, foreign exchange authorities have maintained and increased the value of foreign exchange reserves while ensuring their security and liquidity, and served the national strategy by using foreign exchange reserves, providing a strong support for the Belt and Road Initiative and international production capacity cooperation. Fourth, foreign exchange authorities have been dedicated to strengthening the Party's self-discipline in all respects. New results have been achieved in the building of the Party's politics, ideology, organization, work styles, discipline and systems. Efforts have also been stepped up to build the foreign exchange administration teams.

Participants at the meeting believed that by following the decisions and arrangements of the CPC Central Committee and the State Council and adhering to the general work guideline of making progress while maintaining stability, foreign exchange authorities took the initiative to press ahead with law-based administration and the reform of delegation, regulation and service, supported the development of new trading formats and enhanced trade and investment liberalization and facilitation in 2017. Also in the year, they deepened reforms in key areas and pushed forward the capital account convertibility and the development of the foreign exchange market; they raised requirements on authenticity and compliance reviews and cracked down on foreign exchange irregularities such as underground banks to safeguard the healthy and orderly development of the foreign exchange market; they improved the way of foreign exchange administration and strengthened the micro regulation capability in the foreign exchange market; they strengthened the operation and management of foreign exchange reserves to ensure their security, liquidity and the maintenance and growth of their value; they pushed forward the Party self-discipline in all respects and built professional talent teams with high qualities. As a result, new progress has been achieved in foreign exchange administration.

Participants at the meeting realized that the 19th CPC National Congress kick-started the march towards socialism with Chinese characteristics for the new era, and proposed the new targets and tasks for building the modern economic system at a higher level and boosting the new landscape of full opening-up. In the new era, foreign exchange authorities should have a new look and make new contributions, making studying, promoting and implementing the spirit of the 19 CPC National Congress their top political task for the present and the near future, with a focus on developing a deep understanding of the task. They should develop "four awarenesses", build "four confidences" and ensure "four obediences" to enhance political stance and firmly safeguard the centralized leadership by CPC Central Committee. By implementing the four principles of "remaining true to the original aspiration, optimizing the structure, enhancing regulation and following market orientation", they should endeavor to ensure sound foreign exchange administration under the new circumstances.

Participants at the meeting stressed that the year 2018 marks the first year of implementing the spirit of the 19th CPC National Congress and the 40th anniversary of the reform and opening up policy, and is crucial to the building of a moderately prosperous society in all respects and the implementation of the 13th Five-year Plan. Foreign exchange authorities should be united around the CPC Central Committee with Comrade Xi Jinping at its core. Under the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, they should implement the requirements on the Party's self-discipline, and align their thoughts and actions with the judgments, decisions and arrangements of the CPC Central Committee regarding the economic and financial conditions. Following the general work guideline of maintaining stability while making progress, the new development philosophy and the requirements on high-quality development, they should focus on serving the real economy, controlling financial risks and deepening the financial reform. On the one hand, they should deepen the foreign exchange administration reform, and boost the two-way opening up of the financial market to serve the country's new pattern of comprehensive opening-up. On the other hand, they should work to ensure the stability of the foreign exchange market, preventing the risks associated with the cross-border capital flows, and safeguarding the security, liquidity, and value maintenance and growth of foreign exchange reserves, to guarantee economic and financial security of China, and make greater contributions to the building of a moderately prosperous society in all respects and the success in building socialism with Chinese characteristics in the new era.

The priorities of foreign exchange administration for the moment and the near future were set at the meeting. First, foreign exchange authorities should unswervingly implement the requirements on the Party's self-discipline. They should support the core position of Secretary-general Xi Jinping in the CPC Central Committee and the CPC and safeguard the authority and centralized leadership of the CPC. They should study, promote and implement the spirit of the 19th CPC National Congress, and carry out educational programs under the theme of "remaining true to our original aspiration and keeping our mission firmly in mind". Focusing on the CPC's political construction, they should clean up undesirable work styles and tighten discipline and build a team of talents with firm political stance, desirable work styles and strong professional expertise, to provide political guarantee and professional support for foreign exchange administration to serve the reform and opening up. Second, they should further enhance the liberalization and facilitation of cross-border trade and investment. To be specific, they should support innovative development of foreign trade, and press ahead with the pilot program of foreign exchange administration for free trade zones. They should properly and systematically push forward the capital account convertibility, protect the legitimate rights and interests of foreign investment, and support capable and mature enterprises to make outbound investment. They should increase the transaction instruments and expand market players to build and improve the open and competitive foreign exchange markets. They should also strengthen risk education programs, guide market players to build the risk neutral awareness, and emphasize the management of foreign exchange rate risks so as to control the risks arising from external impact. Third, the regulatory capability of foreign exchange markets should be improved. Foreign exchange authorities should prevent and mitigate financial risks, and improve the two-in-one management system of macro-prudential management and micro market regulation regarding cross-border capital flows. The macro-prudential policy should be dedicated to the countercyclical adjustment of cross-border capital flows and the micro regulation policy should be devoted to maintaining the order of the foreign exchange market in accordance with the law and regulations. The implementation standards should be stable, consistent and predictable across cycles and foreign exchange irregularities should be cracked down. Fourth, infrastructures should be improved. Foreign exchange authorities should improve the laws and regulations on foreign exchange administration, with the emphasis on the basic work of the balance of payments statistics. They should also build digital foreign exchange administration platforms to improve the security of the foreign exchange administration system. Fifth, the foreign exchange reserves operation capability should be built. Foreign exchange authorities should support national strategies such as the Belt and Road Initiative and international production capacity cooperation, to ensure the security and liquidity of foreign exchange reserves and their value maintenance and increase.

The conference was attended by the members of the Party Leadership of the SAFE, as well as the owners of the SAFE branches (foreign exchange administrative departments), relevant departments of the People's Bank of China and departments and units of the SAFE.