Sat, Oct 14, 2006 - Page 11 News List

China's forex reserves nearing US$1 trillion mark

TOP STATISTICIAN FIRED Qiu Xiaohua has lost his job as National Bureau of Statistics chief, perhaps for daring to suggest that no further action be taken to curb growth

AP , SHANGHAI

China's foreign exchange reserves are fast approaching the US$1 trillion mark, swollen by the country's surging trade surplus, the central bank reported yesterday.

China's foreign reserves, already the world's largest, reached US$987.9 billion by the end of last month, up 28.5 percent from a year earlier, the People's Bank of China said in its quarterly report.

The currency reserves have mounted steadily as Beijing buys US dollars and other currencies in an effort to control the value of its currency, the yuan, amid an export-driven influx of foreign money.

The central bank said China added US$169 billion to its reserves in the first nine months of this year. Its reserves had climbed to US$941 billion by the end of June. If they continue to rise at the current rate, they are likely to exceed US$1 trillion within a month's time.

Analysts estimate that three-quarters of China's reserves are in US Treasuries, reflecting the dominance of the US dollar as a reserve currency.

By the end of last month, China's global trade surplus was at US$110.9 billion surpassing the annual record of US$102 billion set last year.

Robust exports and new lending have defied planners' efforts to rein in economic growth, projected at 10.5 percent for this year.

New loans by Chinese banks, a key measure of investment in construction and other infrastructure, totaled 2.76 trillion yuan (US$348.9 billion) by the end of last month, the central bank said.

The bank's target for new loans for the entire year was 2.5 trillion yuan.

Meanwhile, the government announced that the country's outspoken top statistician, Qiu Xiaohua (邱曉華), was abruptly replaced seven months after his appointment.

Qiu, 48, was a 24-year veteran of the National Bureau of Statistics, frequently appearing when major data was announced to provide analysis of trends.

The official Xinhua news agency gave no reason in its announcement of Qiu's dismissal.

The Shanghai-based newspaper Oriental Morning Post noted that Qiu suggested at a recent news conference that the government should not take further action to curb economic growth, though other top officials have said more measures may be needed.

It was unclear, however, if Qiu's departure was linked in any way to those revisions.

Leaders apparently preferred an outsider as Qiu's replacement.

His successor, Xie Fuzhan (謝伏瞻), is an expert on macroeconomics and corporate reform from the Cabinet-run State Development Research Center, who reportedly has never worked in the Statistics Bureau.

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