China is considering allowing the subsidiaries of multinationals
to complete inter company transactions using foreign exchange, Deng
Xianhong, vice director of the country's forex watchdog has
said.
The State Administration of Foreign Exchange (SAFE) said this
would allow multinationals to by-pass SAFE which now requires
foreign companies to purchase foreign exchange from SAFE, Deng said
without elaborating.
China will also strengthen monitoring irregular cross-border
cash flow and illegal forex dealings, he said.
SAFE will ease restrictions on individual and company use forex
as well as broadening the scale and types institutions that can
conduct overseas financial investment, Deng said.
China has announced a series of plans aimed at trimming the
country's huge international payments surplus earlier this
month.
The country's forex reserve had reached US$1.2 trillion by the
end of this March, up 37.36 percent year on year while its trade
surplus reached US$46.44 billion in the first quarter of 2007,
nearly doubling the US$23.3 billion surplus in the same period last
year.
(Xinhua News Agency April 29, 2007)