in china about combating money laundering and terrorist financing. before that, i would like to explain the special role of the people ’ s bank of china ( pbc ) in anti - money laundering. in may 2003, in line with the need of anti - money laundering development, the state council designated the pbc as the leading government department for anti - money laundering in china. in december 2003, the standing committee of the national people ’ s congress ( npc ) revised the law of the people ’ s republic of china on the people ’ s bank of china and accordingly, pbc is legally responsible for directing and deploying anti - money laundering work in the financial system and monitoring funds movement in anti - money laundering. i. chinese government pays high attention to anti - money laundering and strengthens international cooperation with an open and practical attitude the stance of chinese government towards money laundering and terrorist financing is always clear and firm. with regard to money laundering, the chinese government insists on cracking down all kinds of money laundering activities, supports the establishment of a unified anti - money laundering standards by international communities and is ready to develop bilateral and multilateral international cooperation. after “ 9. 11 ” attack in 2001, president hu jintao mentioned that, “ terrorist financing is the key fund sources and bases for terrorists and terrorism organizations to exist, develop and conduct terrorist activities. to succeed in anti - terrorism, we must contain and eliminate terrorist financing activities. ” therefore, china has signed consecutively on the un convention against illicit traffic in narcotic drugs and psychotropic substances, the un convention against transnational organized 1 / 5 crime and the un convention against corruption. after the “ 9. 11 ” incident, the chinese government promoted the un resolutions 1368 and 1373 on anti - terrorism financing and signed on important legal documents on international anti - terrorism financing, such as the international convention for the suppression of the financing of terrorism, and shanghai convention on terrorism, extremism and separatism. the chinese government is supportive to the establishment of international cooperation framework in anti - money laundering and anti - terrorist financing. in february 2004, china officially applied to join the financial action task force ( fatf ). in february and october 2004 consecutively, the pbc wrote to the chairman of fatf and expressed its commitment to follow the fatf anti - money laundering and anti - terrorist financing recommendations. in january 2005, 33 members of fatf unanimously agreed to accept china as an observer. currently, china

##rrencies had the additional advantage that the us net investment position improved when the dollar depreciated. although the international monetary system based on the “ dollar standard ” has not been performing some of its essential functions, it is by no means clear what could replace it. all those that have been mentioned – a supranational currency like the sdr ; a tripolar system based on the dollar, the euro and an asian currency – face very substantial difficulties. underlying all this is the fact that the international monetary system that emerged after the demise of bretton woods is a “ non - system ”, driven by the revealed exchange rate preferences of the individual countries, with a very weak multilateral surveillance, despite recent attempts to strengthen it. the regime of fixed exchange rate pegs was never replaced by one of generalised free floating, but instead gave way to a hybrid system. in practice, throughout the last 35 years, the exchange rate policies of a majority of countries have been marked by widespread “ fear of floating ”, with large foreign exchange intervention. this fear is not at all surprising, since large exchange rate fluctuations driven by capital flows can be highly disruptive in a world that is increasingly integrated economically and financially 3. a broad and lively debate on the design of such tools has recently developed. see, for example, the paper by c. borio on “ implementing the macroprudential approach to financial regulation and supervision ” ( published in banque de france financial stability review, september 2009 ), the discussion paper by the bank of england ( “ the role of macroprudential policy ”, discussion paper, november 2009 ) and the report of the warwick commission on international financial reform ( the report of the second warwick commission report : in praise of unlevel playing fields, november 2009 ). see also, on these issues, i. visco, “ the global crisis : the role of policies and the international monetary system ”, cit. 4. the main challenges ahead 4. 1 correcting global imbalances and fostering sustainable growth whatever the shape of the future system, an urgent task – to be addressed as soon as the economic situation improves – is correcting existing imbalances. the fundamental macroeconomic imbalances that lay at the root of the financial crisis are not being righted by the consequent global recession. at present, the rise in us private sector saving and the sharp fall in investment, partly offset by a larger public sector deficit,