Study Of China's Capital Account Opening

Along with constantly deepen of the economic globalization, finance globalization and finance liberalization, the capital account opening has become one of the inevitable choices for a country who want to be involved in the world economy. In the meantime, to deepen financial reform, improve the financial supervision mechanism, to accelerate the pace of economic development, to resolve the trade shock and friction and to improve the effectiveness of capital control, the capital account opening in our country is necessary. In this paper first give a definition and connotation on capital account opening, regards the process of the capital account opening is gradual and moveable. In the part of review of the literature, illustrate the research development on capital account among the home and abroad scholars, which are the arguments on the open mode, open conditions and open order of the capital account. Base on the above theories, this paper analyze the process of the countries which are typical in capital account management, to gain the experience which we can draw lessons from these countries. In chapter four, first illustrate the actual state and objectives our country are going to achieve, depending on the actual economic statement and international financial situation, this paper then focuses on the open order of capital account in China, which is specific to the inner order of subitems, and then points out that lately the process in China is mainly lied to the gradual release of capital control and the release of securities investment control. At the same time, towards the asymmetric opening policies which encourage the capital outflow and restrict the capital inflow, brings up the policy suggestions. In the end, based on the actual state of our country's capital account opening, point out the specific steps from four aspects which are capital flows, the length of period, transaction items and the main body of transaction .From the point of capital flow, need to carry out reverse open policy and speed up the release of capital control; From the length of the period, need to release long-term capital flows first then short-terms, speed up release the control of short-term capital especially the short-term outflows. From the main body of transaction, separate the residents and non-residents, first open the foreign transactions from residents then open the domestic transactions from non-residents. In general, the capital account opening process is gradual, the 30 years experience of reform and open has been proving that this gradual mode is successful, in the same time, the capital account opening is relative open, not means no restrict at all. The capital account opening in our country should go towards the way which is less restrictions but depend on the specific macroeconomic situation to move forward or move back. When the economic situation is good then speed up the open step to be involved in the world and share the world economic accomplishment, otherwise we can even stop or re-introduce restricts to guarantee our country's economy to develope in a sustained , healthy way!...