PBOC: China to further push yuan convertibility in 2013

At a financial forum in Beijing on Thursday, the deputy governor of the People's Bank of China gave an outline of how China's monetary policy will shape up in 2013. Li Dongrong also said China will steadily push for yuan convertibility under its capital account next year. He also vowed to boost the flexibility of the yuan's exchange rate.

Yin Hang said, "The Central Bank deputy governor said on Thursday that it will speed up reforms in China's financial sector in 2013. It's also going to push forward the convertibility of the yuan under China's capital account."

Li Dongrong, deputy governor of People's Bank of China, "Currently, important reforms in China's financial sector, such as the Renminbi convertibility under its capital account, have entered into key stages. The wider its impact goes, the more restraints it will stumble across. So we have to actively improve our overall planning in order to steadily push forward those reforms."

Li also said that China will embark on a fresh round of financial reforms in 2013, and the central bank will make China's financial sector more innovative with lower risks.

China has gradually loosened its grips on its capital flows and actively pushed forward the marketization of the interest rate and exchange rate in the past decade.

Qianhai in Shenzhen city, which neighbours Hong Kong, has been picked as a testland for China's financial opening up. The government has taken various steps to spur the international use of the yuan there.

Zhou Ziyou, deputy chief of Qianhai Administration Bureau, Shenzhen, said, "We will continue to increase a wider use of yuan in cross-border transactions in 2013, and work on boosting the convertibility of the yuan under the capital account. We will also make more innovations to forge closer ties between Shenzhen and Hong Kong in the area of capital and insurance cooperation."

Hong Kong has become a testbed for China to internationalize its currency. Experts believe that it will eventually pave the way for the yuan to become a fully convertible international currency.

China's top economic policymakers said at the Central Economic Work Conference on the weekend that China is to ensure stability while making progress. The government is increasingly relying on reforms to pursue quality and effectiveness of its economic growth.