Almanac of China＇s Finance and Banking 1996 is now released to the public.The voluminous information it affords fully imply the two fundamental features in the performance of China＇s economy and finance.The first is to explain with ample data how high inflation was reined inpreliminary and stability of financial order maintained in China in 1995 withsustained,rapid and healthy economic development and basic realizationof the macroeconomic regulation objective;the second is to record with plentiful materials how the Chinese financial circle persisted inimplementing the moderately tight monetary policy,facilitated effectiveeconomic growth,deepened financial reform in the light of the generaltrend and promulgated and implemented successively the Law of the People＇s Repubfic of China on the People＇s Bank of China and other basic financial laws in ushering in a completely new period of normal and modern financial construction.Beginning from July 1993,in accordance with the arrangement of the State Council,the People＇s Bank of China has adopted a series ofmeasures to rectify financial order,strengthen financial supervision,promote various reforms,transform operating mechanism and quickenfinancial legislative construction.Through more than two years＇struggle,the functional transformation of central bank organs below the provincial level has made remarkable progress and transition from state specialized banks to commercial banks has achieved initial results.The Chinese financial system has marched towards a new step along the orbit of the socialist market economy.International financial institutions and financial circles of all countries have approved the notable results obtained by macroeconomic regulation in China.1995 is the last year of the Eighth Five-Year Plan period.By comparing economic and financial development of the said period with all preceding five-year plan periods,we are easy to find such a conclusion:economic and financial development in the Eighth Five-Year Plan period in China is the most stable five years with less fluctuations and the most successful system reforms.We may also say that in these years,the market innovations of the Chinese financial system have traversed the;distance fulfilled by many developed countries and newly industrialized countries in a dozen or several dozen years.In this connection,we may propose with support,resource and justification to basically build up a financial system adaptable to the socialist market economic system in the Ninth Five-Year Plan period.It is particularly advisable to point out that the moderately tight monetary policy having good results in the three years since 1993 will be pursued further in the Ninth-Year Plan period.The moderately tight monetary policy so called is not the tight policy for money aggregates but the policy with several strata of profound significance:first,the growth margin of money supply should largely equal to the sum of the growthmargins of the economy and projected price rise;second,the growth rateof prices should be less than the economic growth rate by 1 to 2 percentage points;third,the proportion of non-performing assets infinance should reduce from year to year so that the growth of the money supply may contribute to the adjustment of the financial structure andindustrial economic structure;and fourth,macroeconomic regulatory means should be steadily restructured,and monetary policy instruments including interest rate should be used more frequently to regulate the money supply indirectly.In other words,the appropriately tight monetary policy is a strategic macroeconomic policy,which is not a temporary expedient nor a dull mechanic tight policy for aggregates.As China is now in the crucial stage of transformations of the economic system and growth mode,the moderately tight monetary policy will be the prerequisite for bringing out these two transformations.The accomplishments in the past three years are due to an extent to the definite and stead fast monetary policy which will be further maintained in order to consolidate the achieved deeds and to attain higher economicgrowth in the Ninth Five-Year Plan period.Reasons and ways of executing the moderately tight monetary policy in China are detailed in the materials kept in the Almanac of China＇s Finance and Banking.This Almanac notonly preserves the objective historical materials of implementing the monetary policy to promote economic development,but also furnishesindispensable precious resources to the study of financial theory and policy.We have noticed clearly that there are still many difficulties and;problems in financial system reform and development in China and that we must exert greater efforts to attain the magnificent goals of the Ninth Five-YearPlan period;our financial industry should open the market further to promote the level of opening up and quicken the progress of restructuring the convertibility of renminbi of current account items so as to accumulatemore experiences of financial modernization and internationalization.May our Almanac of China＇s Finance and Banking grow more substantial,more refined,more comprehensive and more authoritative to inscribe theoutstanding achievements of the great changes of the Chinese financial industry!
