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Stronger RMB won't affect investment much
By Jiang Wei (China Daily)
Updated: 2005-07-26 06:30
"Investors in China are likely to monitor whether or not the central bank
will make further adjustments to the exchange rate in the short term," he said.
Meanwhile, the expert stressed, that the exchange rate was not the only
element that foreign investors took into consideration when expanding their
business into China.
"First of all, international enterprises will have to consider their overall
global strategy before setting up a business in China," he said.
He explained that to most large international players China is an
indispensable arena.
They are still expected to continue investing in China, especially
considering the country's advantages in geography, resources, policies, and
labour. These aspects are much more important to investors than the exchange
rate, he said.
Lu's thoughts were echoed by those of Mei Xinyu, a trade expert with the
Chinese Academy of International and Economic Co-operation, who added that the
appreciation of the renminbi would help to boost the restructuring of foreign
investment into the country as well as improve its utilization.
Conversely, Lu said the revaluation of the renminbi is expected to help
increase outward Chinese investment.
The experts agreed that it is very unlikely that these effects would become
evident before the end of this year.
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