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2017-07-13 | Beijing

European Chamber Lauds “Exceptional” Openness of China’s State Administration of Foreign Exchange (SAFE)

Beijing, 13th July, 2017 – The European Chamber of Commerce in China today hosted its financial services conference. The keynote speech was delivered by Deputy Governor of the People’s Bank of China (PBOC) and Administrator of China’s State Administration of Foreign Exchange (SAFE), Mr Pan Gongsheng, titled Cross border capital flows: challenges and responses. This represents a further deepening of the highly constructive, ongoing dialogue that has taken place between the European Chamber and the SAFE throughout 2017.

Key points emphasised by Mr Pan during the conference included:

  1. The rules governing foreign exchange have not changed. China’s foreign exchange authorities support authentic and compliant international payments/transfers under the current account. The aim is to enhance cross-border trade facilitation and better serve the real economy and opening up, while strengthening the crackdown on irregularities such as underground banking activities and false trades in order to safeguard the health and stability of the foreign exchange market and China's economic and financial security.
  2. China treats domestic and foreign enterprises equally in foreign exchange management. A foreign-invested enterprise can either use its profits to make further investments in China or remit them out freely. The SAFE will continue to optimise foreign exchange management services of foreign direct investment, and support Chinese enterprises who meet the conditions to go global.
  3. Along with the in-depth advances in supply-side reform, China will achieve higher quality economic growth. In the future, China will continue to be the most competitive and attractive destination for long-term foreign capital.
  4. China’s cross-border capital flows have been stable, and it recently converged to reach a balanced state. The foundation for China’s cross-border capital flows will be more robust in the future.
  5. China will actively expand the degree of opening up. The RMB is on an inexorable path towards full convertibility. Along with China's bond market joining the international major bond index and the bond connect being officially launched, the opening process of China's bond market will be further accelerated. This will help global investors allocate their bond assets more effectively.

“We appreciate the exceptional level of openness displayed by the SAFE, and Mr Pan in particular, as well as the willingness to directly engage with European business to provide more clarity on policy,” said European Chamber President Mats Harborn. “This kind of communication is exactly what the Chamber seeks in all engagements with the Chinese authorities, for the sake of mutual benefit. We are looking forward to continuing to work with Mr Pan and the SAFE on behalf of our members.”

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Lance Noble

June yu

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