The Chinese Government is paving the way for a relaxation of currency trading rules as part of sweeping reforms to the country's financial system. The Governor of the People's Bank of China, Mr Dai Xianglong, also revealed plans yesterday to liberalise interest rate policy completely over the next three years, allowing the market to set both deposit and lending rates. Speaking at a press conference in Beijing yesterday, Mr Dai went on to outline a tough new stance on China's growing number of insolvent financial institutions, warning that the Government was prepared to close down banks to protect the interests of creditors.
The remarks by Mr Dai, a close ally of reformist Premier Mr Zhu Rongji, present the most comprehensive picture so far of the breadth of China's ambitious plans to overhaul its antiquated financial system.
