Beijing was urged yesterday not to rashly open its capital accounts in the coming decade to keep a lid on an overflow of international money and the spread of financial crises.
The International Financial Daily - a Shanghai-based financial outlet - yesterday called for securing the stability of the yuan, China's currency, under the controlled float system and engaging in global parleys on the devaluation of Japanese yen.
"The yuan should maintain its long-term stability under the managed-float system in order to prevent excessive international capital flows and the spread of financial crisis, and in order to cope with a Japanese devaluation," it said. The call came as the Japanese yen tumbled to its three-year low, extending its fourth-quarter slide on December 27 last year - a move that sparked concerns of Tokyo's approach of maintaining a weak yen to boost exports.
Many Asian nations, seeking to step in if Japan's exports to the US falter amid a global economic slowdown, have voiced their concerns of a devaluing yen.
The newspaper said in a commentary the dramatic fall of the yen was not in line with the interests of Asian economies in the short term.
"If Japan allows the yen to fall too much, it will hurt the economies of other Asian countries relying on exports to buck the economic slowdown. A bad scenario will be financial turmoil in Asia," it said.
Asia was the victim of the serious financial crisis in 1997, which sent many Southeast Asian economies into economic woe.
The impact on China was not too serious as its currency was not convertible.
(China Daily January 4, 2002)