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China's foreign exchange chief Guo Shuqing said Monday the country did not pursue a fast increase of forex reserve intentionally, an excuse used by some countries for the demand on yuan appreciation.
China's forex reserve surged by as much as 206.7 billion US dollars in 2004 to 609.9 billion dollars by the year-end, second only to Japan.
"The increase was ascribed to macro-economic performance," said Guo, director of the State Administration of Foreign Exchange, in an interview with Xinhua on the sideline of the annual session of National People's Congress.
Commenting on some people's view that China has excessive forex reserve, Guo acknowledged that there was no "uniform criterion" on the amount of forex reserve both theoretically and practically. "The question cannot be answered simply by 'much' or 'little'."
Forex reserve is of "special significance" for the national economy, said Guo, a member of the 10th National Committee of the Chinese People's Political Consultative Conference (CPPCC), the country's top advisory body.
To keep ample forex reserve will help the country "enhance its ability of international payments, upgrade its overall national strength, raise the credit standing of renminbi, mitigate the risks in reform and safeguard economic and financial safety", he noted.
China has been targeting "basic balance and slight surplus" in international payments for many years.
Guo said China adjusts the currency structure in its forex holdings based on a "long-term strategic and development-oriented "consideration, instead of "blindly" making earnings from big fluctuations in the international foreign exchange market.
"As a highly responsible investor, China always takes initiative to safeguard the safety and stability in the international market and will not get involved in speculations on the exchange rate," the forex chief said.
(Xinhua News Agency March 8, 2005)
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