manuel sanchez : deepening financial reform in china remarks by manuel sanchez, deputy governor of the bank of mexico, at the china financial summit 2014, beijing, 14 may 2014. * * * i am extremely pleased to be back in this beautiful, captivating land to participate in the china financial summit 2014, devoted to the theme of financial reform and economic growth. i would like to thank our hosts for the honor of accompanying such distinguished speakers and sharing some views with you on the implications of financial reform. china ’ s economic miracle for more than three decades, china has experienced a remarkable increase in income and living standards. average annual gdp growth has been about 10 percent, and since 2010 china has become the second - largest economy in the world. this progress has had a global impact. many nations have benefited from china ’ s momentum, through the effects of greater international trade and investment. also, world economic growth has been enhanced, and per capita income disparities have substantially narrowed. 1 china ’ s outstanding economic performance has been the result of sweeping reforms starting in the late 1970s. transformations have included property rights granted to farmers, the opening of many economic sectors to foreign direct investment ( fdi ), the ability to run a private business, the privatization of some state - owned enterprises, the liberalization of goods prices, and the reduction of barriers to international trade. tremendous output expansion has gone hand in hand with urbanization, as well as augmented employment and investment. but most notably, it has been backed by consistently growing total factor productivity. efficiency has benefited greatly from the adoption of technologies and know - how from leading advanced economies. 2 as occurs in any economic development process, china may be facing diminishing returns from already implemented liberalization policies. unexploited opportunities are suggested by the relatively low size of consumption and the service sector in china ’ s economy in comparison with many nations. hence, the sustainability of high growth rates and further widening of benefits to society would seem to require more structural changes. in particular, inefficiencies prevailing in several markets may be too costly to allow for continued high rates of economic expansion. to take hold of these opportunities, the plan for reform announced by china ’ s government last november aims to make the economy more efficient and market oriented. the reform agenda is ambitious, involving a great number of issues. the following are just a few that stand out : the protection of property rights, the deregulation of non - public enterprises, further liberal

i have no doubts that the success of european integration in the past will continue into the future. as mentioned before, the oesterreichische nationalbank ( oenb ) very closely tracks and analyzes the process of european integration of central and eastern european countries. to keep the interested public informed about economic topics pertaining to this region, we hosted the “ east - west conference ” year after year and published a “ focus on transition ” twice a year. since the process of european integration has permanently closed the divide that used to run across europeand since the new central and eastern european eu member states have successfully completed most transition steps - and therefore can no longer be labelled transition economies - we had good reasons to update the names of two of our most important products. our conference and our publication are complimentary products. therefore we decided to choose a common name. this year ’ s conference is the first to take place under the new name : “ conference on european economic integration ( ceei ) ”, a name which reflects the growing - together of europe. in parallel, we relaunched the “ focus on transition ” as ” focus on european economic integration ”. the first issue was published recently. hand in hand with the renaming we also have renewed the structure and content of our products, an effort that was greatly aided by the results of a reader survey conducted this year. we will continue to investigate economic topics relevant to the new central and eastern european eu countries, such as the adoption of the euro. furthermore, we used the opportunity to extend our geographical focus to the region of south east europe. this year ’ s “ conference on european economic integration ” entitled “ south eastern european challenges and prospects ” is dedicated especially to this part of europe ; which comprises, as we understand it, the countries albania, bosnia and herzegovina, bulgaria, croatia, macedonia, romania, serbia and montenegro. since the eight central and eastern european countries joined the eu, the eu integration process has clearly shifted south east. apart from romania, bulgaria and croatia, which are next candidates for accession, all other south eastern european countries now have an accession perspective, as recently stated by the european commission. the stability pact for south eastern europe has been assisting the difficult catching - up process of this region. we will hear more on this pact later today. for completeness, let me shortly mention the case of turkey. last month, the european commission recommended to start accession negotiations with turkey. based on the report and recommendation from the european commission,