Macro-Finance Salon (No. 112): The Book Launch for China’s Choice in the Global Financial Turbulence

On the morning of January 12, Macro-Finance Salon (No. 112) and the book launch for China’s Choice in the Global Financial Turbulence was held in Renmin University. The author Mr. Wang Yongli, member of IMI Academic Committee and former vice president of Bank of China, gave a keynote speech. Also attending the discussions are: Wei Benhua, former deputy administrator-in-bureau of SAFE; Guan Qingyou, director and chief economist of Rushi Finance Research Institute; Zhang Jie, director of IMI; Tu Yonghong, deputy director of IMI. The salon was presided over by Prof. Song Ke, deputy director of IMI.

Song Ke

In his keynote speech, Mr. Wang shared his motivation for writing the book, as well as its main contents. As the world today witnesses great economic and social changes, and financial risks surface, becoming more prominent, Mr. Wang believes that it is vital to look back and trace the 40 years of Chinese high speed monetary and financial advancement, ever since the reform and opening up policy, as well as to look forward and analyze China’s strategy in today’s global structure. Doing so can help readers look past the surface, and sense the magic and mystery of finance, as well as facilitate the appreciation and accumulation of wealth.

Wang Yongli

As Mr. Wang pointed out, although the internet has just begun its impacts on our society and the financial sector, to study its applications in finance, we would have to also follow the essentials and underlying logics of finance. There is another evolving topic—the future of the international monetary and the financial system and what role should China play in such a future. These are the core topics covered in the China’s Choice in the Global Financial Turbulence. Mr. Wang further pointed out that China should accelerate its establishment of an international finance center, and expand the RMB’s leadership role as an international currency by promoting it as the money of account and clearance in commodity trades and financial transfers. He emphasized that the RMB, as the money of account and clearance, should be actively introduced to the world; the global RMB clearance and trade center should be located in China Mainland, not offshore. Total money in China started decreasing since 2013; household net deposit has peaked by the end of February 2015; and total liability rate was about 270% GDP at the end of 2017. Based on multiple indicators, 2015 was an important turning point for China, transforming from high-speed to normal development. In the past year, 2018, China saw a decrease in liquidity, caused by strict financial regulation and de-leveraging to control financial risks. Looking forward, 2019, the 70th year since the founding of People’s Republic of China, will be a challenging year as China switches gears in its economic development. In the roundtable discussion, attending experts discussed various topics, including: money development mechanisms, international finance management, monetary finance, China’s choice under the new normal, digital currency including bitcoins and the blockchain market, financial infrastructure, internet financial supervision, the theory and practical development of financial crisis management, China’s research trend for financial research, global income distribution, and financial reform in China. After the seminar, the participants engaged in friendly conversation. With Spring Festival coming up, Mr. Zhang Jie handed a Chinese ‘Fu’(Blessing) written by himself to Mr. Wang Yongli, as a well-wish for the coming year, thanking him for his collaboration with IMI in the past year, and expressing his hope for further collaboration and exchange.

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