China Will Not Change Domestic Monetary Policy, Zhang Says
November 03, 2011, 5:37 AM EDTBy Zijing Wu and Rebecca Christie
(Updates with Zhang comments from fourth paragraph. For debt crisis news, see EXT4. GMEET for G-20 stories.)
Nov. 2 (Bloomberg) -- China won’t revise its domestic monetary policy, said Zhang Tao, director general of the international department of the People’s Bank of China.
“As to China’s domestic monetary policy, we will not change,” Zhang told reporters today in Cannes, France, before a Group of 20 summit.
Premier Wen Jiabao said on Oct. 25 the government will fine-tune economic policies as needed, and China said this week it will lower the threshold for payment on value-added and business taxes for small companies. The government may keep “relatively easing” credit policy through the fourth quarter, the China Securities Journal said today, citing unidentified people in the banking industry.
Europe’s sovereign debt turmoil and the global economic outlook have led the agenda for this week’s summit, as European leaders urged Greek Prime Minister George Papandreou to spell out how he intends to stick to the terms of a week-old bailout plan after called for a referendum. Last month, French President Nicolas Sarkozy said he would approach China about playing a bigger role in the crisis-fighting strategy.
China has “confidence” in the European market, Zhang said today. He also said China remains open to increased flexibility of the yuan and will continue to “improve” its exchange-rate regime.
Forex Management
Foreign exchange management in China is based on “the principle of safety, liquidity and adding value,” Zhang said. “Europe was, is and will be an important investment market in the foreseeable future.”
China hopes for a quick resolution of issues raised by Greece’s decision to call a referendum on its bailout, Vice Finance Minister Zhu Guangyao told reporters at the same briefing in Cannes.
“We hope the time of uncertainty will be reduced as much as possible to protect market stability,” he said. Zhu said it’s “too soon” for China to discuss further bond purchases from Europe’s revamped rescue fund.
--Editors: Alan Crawford, Joshua Fellman
To contact the reporter on this story: Zijing Wu in Brussels at zwu17@bloomberg.net Rebecca Christie in Brussels at rchristie4@bloomberg.net;
To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net
