International Foreign Exchange Reserve Management And The Implications For China

Our country exchange cover scale has had very big going up over the past almost several tens years, from breaking 100 billion U. S. dollar in 1996 to breaking 1 trillion U. S. dollar in 2007. The so high-speed increase and gigantic scale, are a double-edged sword to our country development of the economy. As a developing country, China definitely needs a certain amount of foreign exchange to ensure external payments, interfere with foreign exchange market and promote the country credit. But excessive exchange cover scale may produce the administration problem: scale controls problem, cost and avails. This paper tries to find some thoughts and countermeasures to solve the current foreign exchange managing problem though international comparisons of exchange cover managing. This paper has six parts:Exchange cover's introduction. This part introduces definition, characteristic and functions of foreign exchange.Exchange cover's management theory. This part summarizes quantity management theory and structure management of exchange cover, so as to provide studying platform for this paper. Quantity management theory mainly introduces the import, moderate scale theory as well as some research methods: Proportion analyses law, regression analysis law and cost-avails law. Structure management summarizes the theory evolution, management principles and currency kind of combination principle. Exchange cover's international comparison on quantity management. Making use of a little easy to count and secretly scheme against research methods such as exchange cover and entrance proportion law, exchange cover and the GDP proportion law and exchange cover and short-term foreign debt proportion law, this part try to find some experience and enlightenment from the international comparison on quantity management.Exchange cover's international comparison on structure management. After introducing the current structure management situation of USA, Euro area, Japan, Korea Republic and Singapore, this part carry out international comparison from several angles including administrative system as well as targets, currency and assets structure, along with the risk administration.Chinese exchange cover development general situation and their managing problems. This part introduces our country exchange cover's development and points out some causes of exchange cover sustained growing: sustained Favorable balance of current account and Capital item, USA factor, insufficient domestic needs and import, capital controls and exchange rate system, as well as some problems being confronted with including increasing by quickly and enormous scale, lower managing avails, relatively imperfect administrative system, not optimized currency kind and assets structure, shortage of professional person good at exchange cover assets investment.Some Enlightenment. This part summits some measures and suggestion to solve the problems of our country's exchange cover management. To control scale, we can expand domestic demand, improve trade structure, keep balance of international payments, appropriately loosen foreign exchange control, and have a step to reform exchange rate system. To manage well, we can perfect our country exchange cover administrative system, optimize exchange cover currency structure and assets structure, make great efforts to create the optimum exchange cover economic effect, strengthen the transparency of our country exchange cover management, build exchange cover risk administration system and reinforce to cultivate professional person...