From: China News Digest, Wednesday, December 13, 1995

[CND, 12/09/95]

Chinese Vice-Premier in charge of economics, ZHU Rongji, said that state economic controls must take hold before Chinese currency controls are loosened, Reuters reports. Otherwise, the nation would risk runaway inflation, Zhu warned. China has been able to keep inflation under 15% owing to stringent economic management. Zhu maintains that for China, some economic controls are necessary. He points out that even the US government wields economic control by adjusting interest rates. Until loss-making Chinese state enterprises are turned around, state intervention will be necessary. Zhu said that the promise to make China's renminbi yuan completely convertible before the year 2000 refers to current accounts only. However, the present Chinese economic robustness will push this date forward. (Tricia, Liedong ZHENG)