An official with the People's Bank of China (POC) said on Friday that some analyses made by the International Monetary Fund (IMF) in its staff report for 2005 Article IV: Consultation with China, does not reflect latest developments.
The IMF published the report on November 18, the second issue since China resumed its legal status in the organization in 1980.
According to Article IV of the IMF convention, the IMF consults with all member governments regularly to learn about their macro-economic operations and monitor their economic policies.
The official said that the Chinese government has held annual consultations with the IMF since 1980. The report, written by IMF staff following the consultation, reflects the judgment and views of IMF staff on the economic and financial situation in relevant countries.
But because statistics used in the report are from before July 2005, some analyses might have to be updated, the official said.
Talking about China's macro-economic and financial situation, the official said that China's economy has been growing stably and rapidly in general, but some problems still exist, including overactive fixed-asset investment growth, imbalanced imports and exports, increasing trade disputes and challenges brought on by forex reserve growth.
The central bank will continue with its monetary policies, enhancing structural adjustment through marketization and pushing forward reforms on Renminbi valuation.
There has been no big change in China's economic development and finance market, the official said.
As for China's exchange rate mechanism reform, he said that China made an important step and substantive progress in this regard on July 21, 2005.
Generally speaking, this reform was smooth, and from the global reaction, the result was positive and objective, he said.
Keeping the exchange rate basically stable at a reasonable and balanced level and the establishment of a manageable floating exchange rate regime on the basis of market supply and demand are China's persistent direction and goal of reform, he said.
"This is a process of gradual advancement and improvement," he said.
China will continue to advance the exchange rate reform with the principles of independent initiative, controllability and gradual progress, and the reform will also proceed from the necessity to maintain the development and stability of China's economy and finance, the official said.
He said that China will further promote reforms to produce an RMB exchange rate mechanism that is more flexible to changes in market demand and supply, and the government is willing to consider the advice and suggestions of various parties.
On July 21, China's central bank announced that China's currency, the RMB, would be traded at a rate of 8.11 to the US dollar. The yuan to US dollar pegging system was removed, and yuan valuation based on a basket of foreign currencies.
(Xinhua News Agency November 18, 2005)
