China's Central Bank Officer Warns Of Fallout Despite Solid Economy

China must prepare for challenges sure to be brought about by the global financial crisis, although the nation's economy was generally in good shape, central bank governor Zhou Xiaochuan said Sunday. Reporting to the Standing Committee of the National People's Congress on China's prospects in the face of the worst financial crisis in 80 years, Zhou said that China's economy was developing as expected, but the world economic slowdown added uncertainty. Zhou said the People's Bank of China would adopt flexible and prudent macro-economic control policies to strive for the stability of the financial sectors and promote sound and rapid economic growth. He said the central bank would strengthen supervision of China's banks and develop contingency plans to deal with any negative impact from the global crisis. The PBOC would work to maintain a sufficient supply of credit on the domestic market, he said. Zhou told law makers that the central bank would let the market play a "bigger role" in deciding upon interest rates and keeping exchange rates stable. (Oppenheimer The Dragon Call Oct.27, 2008)