China advances in its opening by appointing Yi Gang governor of the central bank

China today confirmed its desire for economic opening with the appointment of reformist Yi Gang as the new governor of its central bank, which is expected to continue on the modernizing path of its predecessor, Zhou Xiaochuan.

Despite being number two and Zhou’s right hand, Yi did not figure in the pools on who could succeed the former governor of the People’s Bank of China (central), so his appointment decided today by the plenary of the National People’s Assembly ( highest legislative body in the country) was received with surprise.

On the contrary, the elevation of Liu He, economic adviser and ally of President Xi Jinping, to the position of Deputy Prime Minister of Finance and Planning, was expected, a position of maximum responsibility that will also be decisive for the management of commercial relations with the USA and the economic opening.

“The main task (of the central bank) right now is to implement a prudent monetary policy, to promote the reform of the financial sector and its opening, and to maintain the stability of the sector,” Yi told the press shortly after his promotion became public. in the Great Hall of the People in Beijing.

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His pro-reformist profile and his extensive training abroad seem to point to Yi (60-year-old Pekinese) continuing on the modernizing path initiated by Zhou and encouraging the opening of finance to investment from abroad.

Yi Gang is considered a leader “with very deep international ties,” BBVA Research economist Jinyue Dong told Efe.

In his opinion, the election of Yi is a sign that China “will promote financial liberalization and liberalization, as well as connect the domestic financial sector with the world, in particular by promoting dialogue between China and the West”, while at the same time perpetuates its monetary policy.

Yi studied Economics for two years at Peking University, the Business Administration at the University of Hamline (Minnesota, USA) and Economics at the University of Illinois, where she also studied her Ph.D. specialized in the selection of statistical models.

In 1986 he began his career as a professor at the University of Indiana, a position he left in 1994 to return to China and join as a professor at Peking University.

He joined the People’s Bank of China in 1997 and, five years later, was appointed Secretary-General of its Monetary Policy Committee. From that position, he led in 2004 the reform of rural financial institutions and, in 2007, he was appointed vice governor.

From 2009 to 2016, he headed the State Administration of Foreign Exchange (SAFE) and was in charge of reforming China’s foreign exchange system and diversifying its investments.

In addition, he was involved in the research and design of the reform of the Chinese social security system and is recognized for his determination to help the poorest strata of society.

He is credited with having asked the Government, already in 2002, not only to take care of the growth of the Gross Domestic Product of the country but to take into account factors such as employment, the environment and the indebtedness of the banks.

His appointment coincided today with the rise of Liu He to the level of the country’s economic vice premier.

“Liu and Yi are expected to lead the Chinese financial sector,” he told Efe Dong, who recalled that “since Xi came to power in 2012, Yi served as Liu He’s right-hand man.”

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The latter, 66, studied at Harvard University and his role in the Chinese economy has been increasing recently.

In January, he intervened as China’s representative at the World Economic Forum in Davos (Switzerland), one year after President Xi himself, and in February he traveled to the US to analyze the economic and trade relations between both countries, at a time critical for bilateral ties.

“Possibly Liu He is the most important economic legislator in the world (…) He was granted considerable honor at the beginning of the year to be the only spokesman to intervene in one of the main Davos sessions without being a national leader,” he said. in an analysis Matthew Dobbs, manager of Asian equities of the British Schroders.

Three days before Liu’s appointment as deputy prime minister, Dobbs reflected that Liu had “no impressive office, beyond economic adviser to China’s president, Xi Jinping, who has given him an open power over the second largest economy in the world. “