— An exclusive interview with Sun Tianqi, director general of the General Affairs Department of the State Administration of Foreign

China Forex: In 2017, the world underwent a period of great adjustment and change. China's economy entered a crucial stage, transforming its development mode, optimizing the economic structure and shifting its growth momentum. Foreign exchange administration departments are deepening reforms in key areas by promoting trade and investment liberalization and facilitation, and these efforts have achieved positive results. What has been done by the general departments in promoting the above key tasks?

Sun Tianqi: In 2017, the work of the Communist Party groups in the State Administration of Foreign Exchange(SAFE) focused on the foreign exchange administration center, promoting our fundamental tasks, such as policy research and the formulation of laws and regulations.Our objectives also included stepping up communication with the market, adhering to administration by law,holding the line on risk, and giving full play to our regulatory efforts. We have made positive progress in all of these areas.

First, we carried out forward-looking research by making preparations for deepening reforms in foreign exchange management. We have made substantial efforts to serve reform and policy decision- making.We focused on the completion of a post-transaction micro-regulatory framework in the foreign exchange market as well as the establishment of self-regulatory mechanisms in the foreign exchange market. We carried out research on a wide range of topics, such as current account convertibility, the US relaxation of financial supervision and Brexit.We examined restrictions on foreign exchange by countries involved in the Belt and Road Initiative as well as China's own preinvestment practices to gain a better understanding of the hurdles we might face.

Second, we vigorously promoted decentralization of authority in order to facilitate trade and investment. We continued to actively support free trade pilot zones, studying relevant reform proposals and closely examining the foreign exchange receipts and payments situation and introducing foreign exchange administration support policies. This was also aimed at improving post-transaction supervision and the assessment of statistical data to prevent risks from crossborder capital flows. We continued to promote the simplification of the foreign exchange account system and improve the efficiency of capital use by streamlining the number of accounts that are required in the banking system. We supported the construction of a selfregulatory mechanism in the foreign exchange market,urging banks to boost their self-regulating capabilities,strengthen education for investors in foreign exchange and regularly monitor Internet platforms to eliminate risks from illegal Internet foreign exchange transactions and thereby create a healthy and orderly market environment.

Third, we improved the transparency of policy information by responding to social concerns. We organized routine press conferences, publishing authoritative information,engaging in discussing hot topics and creating conditions for building a correct understanding of the overall foreign exchange situation and the policies for ensuring market confidence. We strengthened our preparation for key tasks, promoting government information disclosure.

China Forex: This year is the 40th anniversary of the reform and opening up program. It is also a year for implementing the spirit of the 19th Communist Party of China's National Congress. What does this mean for the foreign exchange administration?

Sun Tianqi: First, we must earnestly study and implement the requirements of the Communist Party's 19th National Congress in an earnest way. This means embracing the key themes at the branch level.

Second, we must strengthen our investigative and research abilities.

Third, we must serve China's new pattern of opening up to the outside world by supporting innovation in foreign exchange policies. We will continue to implement foreign exchange management that supports measures in the pilot free trade zones. We need to learn from the pilot experiences and build on these experiences in a timely manner. We must serve the key national strategies,and thereby support policies and risk prevention efforts regarding the Belt and Road Initiative. We will publish our Outlines of Foreign Exchange Administration of Countries Involved in the Belt and Road Initiative on a regular basis,preparing manuals on related foreign exchange risks. We will actively promote the improvement of the basic rules and regulations on foreign exchange administration.

Fourth, we must extend our efforts to decentralize authority while relaxing certain restrictions and delivering quality service. We acknowledge the fundamental role of the market in allocating resources. We will further promote the standardization of administrative examination and approval, continuing to reduce and streamline the examination and approval process, so as to improve the licensing instruments and improve service standards. We will continue to vigorously work on the foreign exchange control laws in order to facilitate market participants to understand foreign exchange administration policies. Fifth, we must pay attention to market communication with precise applications of policy. With the government website as the main platform for publicity, we use Weibo and WeChat to release important policies and statistics regarding government affairs in a timely and accurate manner.We will disclose information in accordance with laws and regulations. We will properly disclose the applications of the social entities, by improving the transparency of foreign exchange administration. We will take the initiative in interpreting the overall foreign exchange situation and foreign exchange policies in order to guide market expectations correctly. We will address social concerns and clarify misunderstandings and misinterpretations in a timely manner. We will establish coordination mechanisms with the relevant the regulatory departments of relevant countries, in order to strengthen the international exchanges and cooperation.

Sun Tianqi, director general of the General Affairs Department