Macro-management system of balance of payments

The balance of payments is a comprehensive reflection of a nation's external economic activities. The balance sheet is an integrated record of a nation's external payments and earnings in a certain period of time and an important basis for macro-economic policy making. China began to compile its balance sheet in 1980 and has published it since 1982. A new method of declaring external payments and earnings was put into practice in 1996, and indirect declaration by financial institutions was carried out in the same year. Direct declaration of four types of business began in 1997 including direct investment, securities investment, external property and profit and loss of financial institutions, and foreign exchange payments and conversions. The balance of payments statistics and the relevant analysis and forecasting has played a very important role in the tuning and management system of the Chinese macro-economy.

According to the reporting system of balance of payments statistics, Chinese residents ^[7] must duly report their international receipts and payments accurately and comprehensively with effect from 1 January 1996. Reporting may be made mainly through financial institutions, item by item for each business day, for checking and verification by SAFE. If any problems are discovered , the bank concerned should rectify them without delay.

FFEs in China and Chinese enterprises with direct investment abroad should report directly to SAFE their direct investment statistics concerning the rights and interests of investors, liabilities as well as proportions of dividends .

Domestic securities registration agencies and dealers on domestic stock exchanges should report to SAFE on receipts and payments under transactions in securities investments made for their own account or for clients. Dealers trading in offshore securities for their own account or for domestic clients should complete and submit to SAFE a reporting form for offshore portfolio Investment.

^[7] Herein refers to: natural persons residing in China for over one year except students; people for medical care; foreign nationals working for foreign embassies and their dependants; Chinese people going abroad for short stays (residing abroad for less than one year); legal persons (including FFEs) set up in China according to law and missions of foreign legal people (except those of international organizations and foreign embassies and consulates); Chinese government organizations and establishments and army units.