China's forex reserves rise to $4 trillion

BEIJING - China's foreign exchange reserves have risen to around $4 trillion, said a foreign exchange official on Thursday.

"China is trying to make good use of the mounting deposit," said Guan Tao, head of the balance of payment department under the State Administration of Foreign Exchange in an online interview on the Chinese government website, www.gov.cn.

The figure was up from $3.95 trillion at the end of March, and was more than triple the amount for Japan, the world's second largest holder of forex reserves, according to the administration.

Guan said from 2001 to 2013, China's forex reserves grew by $3.7 trillion, while the country's current account surplus and capital inflow through direct investment together totaled $3.8 trillion.

This indicates that China's forex reserve surge is mainly a result of real economic activities instead of hot capital inflows, Guan said.

The official said it is necessary to upgrade China's growth model and economic structure to balance the international payments.

"The one-sided measure of containing speculative money inflow is far from enough," said Guan.

Guan said China will also encourage companies to invest more overseas to diversify the reserve structure and offset financial risks.

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