credit information system for enterprises and individuals. credit records were created for 13 million enterprises and nearly 600 million natural persons, including information of their borrowing activities and law - compliance in environmental protection etc, facilitating their economic and financial activities and promoting economic and social harmony. banking financial institutions have included inquiry into the credit information system as an indispensable step in pre - lending examination. some regions mandate that personal credit reports should be referred to when reviewing candidacy of deputies of the national people ’ s congress and delegates of china people ’ s political and consultative conference and admitting public servants. authorities in charge of human resources, social security, environment protection and quality inspection and quarantine also access the credit information system for information that will help them with industrial credit building and law enforcement. the credit information system, while exposing and preventing financial risks, promoting the deepening of china ’ s financial sector and improving the international competitiveness of china ’ s financial sector, contributes to the improvement of the social credit environment and the healthy development of economy. today the national credit information education month is kicked off in beijing. we hope the event is the just the beginning of credit knowledge dissemination and the improvement of credit awareness. the pbc will continue to support and actively engage itself in the building of a credit system in beijing so as to push forward the reform and development of beijing ’ s financial sector. this event takes the theme of “ keep good credit records and enjoy a happy life ”. if you want to know more about credit information, how to build good credit records and etc., you are welcome to join our activities in the education month. i wish the education month a complete success.

zhou xiaochuan : remarks on china ’ s trade balance and exchange rate summary of remarks by mr zhou xiaochuan, governor of the people ’ s bank of china, on issues related to china ’ s trade balance and exchange rate, at the china development forum sponsored by the development research center of the state council, beijing, 20 march 2006. * * * analysis of china ’ s trade surplus 1. the process of globalization, cross - border outsourcing and restructuring of supply chains has been accelerating in recent years, supported by it revolutionary progress and the improvement of infrastructures. it now becomes possible to outsource those activities which would be difficult to outsource to foreign countries in the past. 2. there is a time lag in changing the layout of competitive advantages. some labor - intensive production activities and services are usually outsourced to developing nations like china and india, while it will take a certain period of time before the developed countries ( where the production cost is high ) could create new jobs and develop new export advantages. trade imbalance could expand during such a period of time lag. 3. fdi ( particularly, of mncs ) has been playing a dominant role in cross - border outsourcing into china and in changing the landscape of trade balance. china has grown into a re - export processing center mainly by foreign - funded enterprises, with the supply chains increasingly expanded and value - added steadily enlarged. exchange rate elasticity of such production and trade is fairly small. 4. from 1998 to 2004, china ’ s foreign trade was relatively kept in balance, with the annual trade surplus averaged between us $ 20 billion and us $ 30 billion. however, trade surplus suddenly escalated to us $ 100 billion in 2005, which could be mainly attributed to the slower growth of import in contrast to the steady growth of export ( in 2005, export registered a growth of 28. 4 percent while import increased by 17. 6 percent ). the slower growth of import was mainly caused by the declining import growth of equipments, a factor related to the structural adjustment of the chinese economy. 5. fdi ( particularly, of the mncs ) has drastically increased their production and sales in china, substituting china ’ s imports. there are numerous foreign branded or foreign - designed products sold in the chinese market, but a large part of these products have actually been produced by the fdi companies in china. china ’ s exchange rate regime reform 6. china conducted a successful reform