CFETS: RETROSPECT AND PROSPECT

In 2001, under the guidance of "Three Representatives", in the process of carrying out sound monetary policy and stabilizing the forex market, China Foreign Exchange Trade System and National Interbank Funding Center (CFETS) accomplished a series of tasks. To meet the challenges after China's entry into the WTO, CFETS worked out its "tenth five-year development strategy". Prudently and gradually, CFETS merged the Beijing back-up branch under a unified management system.

The forex trading system was upgraded successfully and new varieties and instruments were introduced. CFETS kept on perfecting RMB trading system, developing new services such as cash bond net price trading, yield calculation and display, and trial operation of voice broking.

CFETS also enhanced the quality of information service and extended the electronic filing and quotation system. Membership management and training were improved. Applicable research was advocated, and market statistics and monitors were strengthened.

CHINAMONEY was launched in October 2001 to serve the market and promote innovation among investors and policy makers. CFETS strengthened the administration through further reforms of human resources.

As required by the PBC, CFETS assisted Shanghai Gold Exchange in developing a trading system, which is now under trial operation.

After a year's efforts, CFETS achieved its objectives of securing a stable operation of the trading system, improving the internal administration's efficiency and guaranteeing the constant growth of forex exchange turnover.

The accumulated turnover of the interbank forex trading system in 2001 amounted to 75.033 billion in US dollar term with a daily average of US$297 million, 76 per cent higher than that of 2000.

The accumulated amount of credit funding, repo and cash bond trading reached 4.905 trillion yuan, with a daily average of 19.389 billion yuan, 110 per cent higher than that of 2000.

By the end of 2001, there were about 5000 registered users of "chinamoney.com.cn" and the trading information system with a total of 480,000 clicks.

For 2002—China's first year as a WTO member—CFETS is gearing up for opportunities and competitions that will open up in the financial market and hopes to fulfill all the responsibilities endowed by the Central Bank.

CFETS will improve the present operation mechanism of the interbank forex market, develop new business and products such as foreign currency intermediary and introduce Euro trading. They are making efforts to match the reform of the exchange rate forming mechanism and meet the requirements of the foreign financial intermediary institutions. Besides, they are aimed at adapting to the reforms in China's financial market as well as to promote Shanghai as an international economic and financial center.

CFETS will also expand the services of money market. Based on the reality and needs of the market, the RMB electronic trading system will be updated, referring to the advanced trading systems at home and abroad. Voice broking will be further developed and new varieties and service modes will be introduced.

CFETS will improve the operation and maintenance mechanism of the trading system, promote its network construction process and strengthen the security of the system.

To enhance the information content and technical quality of "chinamoney.com.cn", CFETS will explore new information service modes and contents in an effort to promote the brand of "CHINAMONEY".

Better service will be provided. CFETS will try to improve the settlement service system.

Internal administration will be beefed up. CFETS will attach more importance to the organizational and ideological construction and training employees to build an excellent corporate culture and a strong teamwork. CFETS will also explore new forms and approaches in the active cooperation with their foreign counterparts.

(by Lin Yuli, President, China Foreign Exchange Trade System & National Interbank Funding Center)