China’s Xi says to push yuan reform; FX reserves ample

Since the 1990s, China’s economic growth has relied on the manufacture of exports at competitive prices to generate profits and surpluses. Prime USA concerns are cybercrime, China’s island-building in the disputed South China Sea and building momentum for a global deal to combat climate change.

The reserves, still the world’s largest, were down by Dollars 436 billion, or 11 percent, from a June 2014 peak of USD 3.99 trillion. The market turmoil has left the world’s second-biggest economy struggling for traction even after five interest rate cuts since November and other easing measures.

He said his wife Peng Liyuan is a performing artist and music professor, and that in recent years, as the World Health Organization’s Goodwill Ambassador for Tuberculosis and HIV/AIDS, and UNESCO Special Envoy for the Advancement of Girls’ and Women’s Education, she has met many Americans. Though Chinese investors already have access to most of the U.S. market, fear of losing it is one incentive bringing them to the table.

“I know the staff at the International Monetary Fund is wary because they know the authorities intervene in their currency frequently….”

China was going ahead with changes to make the yuan convertible on the capital account in a “steady and orderly manner”, Xi said. “Because of that foreign capital was not able to make its way into the local markets”.

The modest August devaluation of the currency, which shook worldwide markets, “achieved initial success in correcting the exchange rate deviation”, he said.

While it is easy to look negatively at Beijing’s declining foreign exchange reserves, they do have positive implications for China’s overall goals. Will this affect your plans in China or will you continue to invest in the country?

One such initiative is China’s “Belt and Road” program.

“Xi is obsessed with strategic rivalry with the United States”, said Shi Yinhong, a professor of global relations at Renmin University in Beijing. Some of this is Chinese savings that can no longer be invested productively at home.

Companies in China are facing the challenge of rising costs.

The New Yorker’s Barbara Demick recounts how Bloomberg nearly got kicked out of China for reporting about the wealth of Xi’s family, and how it got back in Beijing’s good graces.

Xi made the comments in a speech on the first day of a state visit to the United States.

China’s strategy is wide-ranging. China is looking forward to strengthening cooperation with the U.S.in more areas, such as clean energy.

While there is no doubt that the Chinese government strongly supports the internationalization of the yuan, Beijing wants to retain control over both the flow of investment from China into other countries and investment into China itself. The scale of money laundering is not small, either: In April 2015, several of these banks were shut down after they had laundered more than $67.5 billion overseas, according to the Ministry of Public Security.

It is likely that the deepening of mistrust between the US and China has much to do with Xi Jinping’s personal style.

Chinese President Xi Jinping pledged Tuesday to not push the value of the yuan currency lower just to strengthen Chinese exports. Over the last couple of months, Chinese state media have argued that retired officials – such as those aligned with former President Jiang Zemin – need to refrain from interfering in politics.

Among the subjects discussed in Xi’s interview are China’s internal reforms, the fight against corruption and the Internet.

Foreign governments have, for the most part, become less willing to speak out over rights abuses as China’s economic heft has grown. China can not sustain older policies of binge credit and investment-led rescue prompted by massive stimulus. Of all of the reforms, those spearheaded by yuan internationalization could be the most politically polarizing.

A Profile Of China’s Future President Xi Jinping – Business Insider – A profile of China’s president in waiting Xi Jinping.