Implementing the Spirit of the Fourth Plenary Session of the 20th CPC Central Committee…

Title: Implementing the Spirit of the Fourth Plenary Session of the 20th CPC Central Committee and Promoting High -Quality Development of Foreign Exchange Administration during the 15th Five-Year Plan Period

The year 2025 marks both the concluding year of the 14th Five-Year Plan and the strategic planning year for the 15th Five-Year Plan, serving as a pivotal transitional period. Under the leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the whole Party and the Chinese people of all ethnic groups have forged ahead to confront the challenges head-on, coordinate both domestic and international situations, and successfully achieve the major goals of economic and social development. In October, the Fourth Plenary Session of the 20th CPC Central Committee was successfully held, at which systematic plans and arrangements for economic and social development during the 15th Five-Year Plan period were formulated. This represents another comprehensive mobilization and overall deployment to seize opportunities and advance Chinese modernization, which is of milestone significance.

Looking back at the 14th Five-Year Plan, China has made major development progress, with its economic strength, scientific and technological capabilities, and comprehensive national power reaching new heights, marking solid strides forward in the pursuit of Chinese modernization. The SAFE have consistently aligned their work with the overall reform and opening-up agenda of the Party and the state, providing robust support for fostering a new development paradigm. First, the balance of payments has become more stable. Foreign trade and economic cooperation have become more diversified and resilient, with the ratio of current account surplus to GDP maintained within a reasonable range. Cross-border two-way investment and financing have remained active. By the end of September 2025, foreign institutions and individuals held over 10 trillion yuan in domestic stocks, bonds, deposits and loans. Second, the quality and efficiency of foreign exchange services in supporting the real economy have significantly improved. The foreign exchange service environment, characterized by "greater integrity with greater convenience", has been further optimized, with enhanced facilitation for cross-border trade, investment and financing. Institutional opening-up in the foreign exchange sector has steadily expanded, supporting the development of Shanghai and Hong Kong as international financial centers, and launching pilot programs for innovative foreign exchange policies in key regions such as pilot free trade zones, the Hainan Free Trade Port, and the Guangdong-Hong Kong-Macao Greater Bay Area. Third, the regulatory capacity as well as risk prevention and control capacity in an open environment have been continuously strengthened, multiple rounds of high-intensity external shocks have been successfully addressed, with foreign exchange reserves standing above US$3 trillion.

Looking ahead to the 15th Five-Year Plan, China's economy boasts a solid foundation, abundant advantages, strong resilience and great potential, with the underpinning conditions and basic trend for the long-term sound growth remaining unchanged. At the same time, attention must be paid to opportunities and challenges arising from the accelerated evolution of profound global changes unseen in a century. First, the global balance of power will undergo profound shifts. The international status and influence of the Global South will be elevated significantly. According to IMF projections, emerging markets and developing countries will account for approximately 64% of global GDP by 2030, an increase of over 5 percentage points from that of 2020. Second, economic globalization will encounter headwinds. Unilateralism and protectionism are on the rise. Industrial and supply chain layouts are shifting toward localization, regionalization, and conglomeration. Economic, trade and technological issues are increasingly over-politicized and over-securitized. Third, the global financial governance system will undergo an accelerated transformation. Relying on a single sovereign currency as the dominant international currency entails inherent risks of instability. Therefore, international financial institutions need to deepen reforms in step with the times, and enhance the voice and representation of emerging markets and developing countries. Fourth, a new round of scientific and technological revolution and industrial transformation will see rapid breakthroughs. Financial technology is reshaping global financial services.

In the next stage, the SAFE will continue to adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, thoroughly study and implement the spirit of the Fourth Plenary Session of the 20th CPC Central Committee, carefully plan the key tasks of foreign exchange administration during the 15th Five-Year Plan period, and strive to build a sound foreign exchange management system featuring "greater convenience, greater openness, greater security, and greater intelligence."

"Greater convenience" means focusing on the demands of market entities to enhance the facilitation of foreign exchange business. Authorities will strengthen reform and innovation in foreign exchange administration and continuously enhance the facilitation level of cross-border trade, investment and financing. The reform of foreign exchange operations in banks will be steadily advanced to ensure smooth and efficient foreign exchange services provided by financial institutions. Support will be extended to the new quality productive forces, with strengthened foreign exchange services for major strategies, key sectors, and weak links.

"Greater openness" means emphasizing deepening reform to achieve high-standard institutional opening-up in the foreign exchange sector. The SAFE will explore new connotations, pathways, and measures for capital account opening-up, so as to effectively enhance the synergy and alignment between the reform of the capital account and the development of the foreign-related economy as well as the internationalization of the RMB. Regional opening-up and innovation, as well as the construction of special zones, will create new frontiers for opening-up. An open, diversified, well-functioning and orderly competitive foreign exchange market will be continuously developed.

"Greater security" means enhancing risk prevention and control capabilities compatible with high-standard institutional opening-up, with a new security architecture as the gurantee. The SAFE will strengthen the two-pronged administration of the foreign exchange market featuring both macro-prudential management and micro-regulation, enhance monitoring, early warning and expectation guidance for cross-border capital flows, comprehensively reinforce regulation in the foreign exchange sector, and crack down on illegal and non-compliant foreign exchange activities, ensure the security, liquidity, and value preservation and appreciation of the foreign exchange reserves.

"Greater intelligence" means relying on the rule of law to strengthen the standardization, effectiveness and foresight of the foreign exchange administration system. The SAFE will reinforce legal safeguards for foreign exchange reform, ensuring that policies are rationally designed, market management is more effective, and administrative enforcement is more standardized. Continuous efforts should be made to advance digital and intelligent technological innovation, providing robust technological support for the establishment and improvement of the foreign exchange administration system and mechanisms.

With the blueprint in place, it is time to take action. Under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, Chinese modernization will open up broader prospects. The SAFE will continue to implement the decisions and arrangements of the CPC Central Committee, always keep in mind the political and people-centered nature of financial work, and unswervingly pursue the path of financial development with Chinese characteristics, contributing to a solid and dynamic start for the 15th Five-Year Plan.

ZHU Hexin is Deputy Governor of the People's Bank of China and Administrator of the State Administration of Foreign Exchange