China opposes IMF rule [ 2007-06-22 16:21 ]
China has expressed "reservations" about a new International Monetary Fund (IMF) ruling on
exchange rate policy, saying drastic exchange rate fluctuations in a country
will damage its economic stability.
The IMF's Executive Board decided on
Friday on a new framework for IMF bilateral surveillance, or the way the Fund
monitors and assesses its member's economies.
It is an update of the 1977
Decision on Surveillance over Exchange Rate Policies. The revised decision adds
the new principle that a member should avoid exchange rate policies that result
in external instability.
The ruling has been widely interpreted as a move
to increase pressure on China to allow a faster revaluation of the
yuan.
"As it does not fully reflect the opinions of developing countries,
China has expressed reservations about the adoption of this decision," said a
statement of the People's Bank of China.
Past experience has shown that
exchange rate adjustment has a role
in resolving external imbalances, but it is not the fundamental and only
instrument to that end, the statement said.
"In the past years, many
developing countries, China included, have worked hard to adjust their domestic
economic structure, improve market mechanisms and increase exchange rate
flexibility. These efforts have contributed to the rapid growth of the global
economy."
(China Daily 06/21/2007 page 13)
Vocabulary:
International Monetary Fund: 国际货币基金组织
exchange rate: 汇率
Questions:
1. What is China's main complaint about
the new IMF ruling on exchange rate policy?
2. How has the ruling been
interpreted?
Answers:
1. Drastic
exchange rate fluctuations will damage a country's economic stability.
2.
As a move to increase pressure on China to allow a faster revaluation of the
yuan.
(英语点津 Linda 编辑)
About the broadcaster:
Suzann Riddle is a senior double majoring in Health Care Management and
Economics at Appalachian State University in Boone, NC. She finds herself at
China Daily Website after visiting many areas of China as a Holland Fellow,
Appalachian's international exchange program with Fudan University.
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