Source: CCTV.com

07-03-2008 13:55

On Wednesday, China tightened the administration of its capital controls in a move to deter speculative inflows of foreign capital. The State Administration of Foreign Exchange said exporters will be required from July 14th to park their export revenues in temporary verification accounts.

On Wednesday, China tightened the administration of its capital controls in a move to deter speculative inflows of foreign capital.

The accounts will be checked to ensure that invoices are backed up by genuine trade transactions and are not being padded. Under the new rules, an exporter seeking to change US dollars into yuan must provide documentary proof to its bank that its invoices are backed by real trade transactions.

Banks will then carry out the necessary checks through a new nationwide computerized income inspection system. The system will also be linked to those of the customs administration, permitting a data cross-check.