CONFIDENTIAL
13
China's foreign exchange reserve position and its external
sector balance
24.
Influenced by the experience in the late
1940s, China has long regarded the accumulation of a substantial amount of foreign exchange reserves as an
important policy objective. Thus, China's policy stance
with respect to its balance of payments position and its
foreign exchange reserves has traditionally been very
conservative. In line with this policy stance, it is not
surprising that the Chinese authorities have expressed
great concern at the large visible trade deficits incurred
by China in 1985 and 1986, which amounted to US$14.9
(5) billion and US$12 billion respectively
(5) China's visible trade balance :
Exports (US$ Bn)
Imports (US$ Bn)
Visible trade balance
(US$ Bn)
1981
22.01
22.01
0
1982
22.35
19.28
+3.07
1983
22.23
21.39
+0.84
1984
26.14
27.41
-1.27
1985
27.36
42.25
-14.89
1986
30.90
42.90
-12.00
1987
16.63
18.64
-2.01
(1st half)
Source: China's Customs Statistics
G.F. 326
CONFIDENTIAL
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