GF 323
CONFIDENTIAL #
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11
10 Dec
A loan of
10 Dec
US$103 million
A loan of US$120 million and a technical assistance of US$600,000
For the Qingdao Environmental Improvement Project to improve air and water quality
For the Industrial Technology Finance Project. The ADB loan will be made available to three major non-bank financial institutions, which will then finance industrial enterprises for the importation, utilisation, commercialisation and adaptation of suitable technology
13.
aimed at
Recently
further
China
announced a four-pronged programme
opening up its financial markets. The
measures included (a) encouraging its banks to set up
branches abroad; (b) attracting more foreign banks to
China; (c) allowing foreign banks to enter into new
businesses in more cities; and (d) gradually opening the country's insurance market. At present, China's banks had
more than 500 branches and affiliates around the world.
Reciprocally, banks from 29 overseas countries and regions had set up 225 representative offices in 14 cities in China. Overseas banks were permitted to open branches only in the Special Economic Zones and in seven selected cities.
14.
During the fourth quarter of 1992, the official
exchange rate of the Renminbi was adjusted downward from Rmb5.50/US$ to Rmb5.75/US$. The exchange rate experienced
an even sharper fall in the country's foreign exchange
adjustment centres.
In the foreign exchange adjustment centre in Shanghai, for example, the exchange rate of the Renminbi closed at Rmb7.7/US$ at end-December, representing
a
at
depreciation of 10% from the level of Rmb7.0/US$ recorded end-September (there was a further depreciation by about
7% to Rmb 8.2/US$ at end-February 1993).
This was
primarily due to the strong upsurge in demand for imported goods in China, with the demand being reinforced by the relaxation of import controls. Speculative purchases or
hoarding of foreign currencies added
to the downward
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