rate regime. with respect to domestic demand, measures such as tax reduction, increase of household income, speed - up of rural infrastructure building, and expansion of financial service to individuals were adopted. and we have also quickened the pace of reform of pension system, health service system, education system and the cultivation the residential mortgage business in order to lower savings rate. all these measures indicate that china is seeking to rely less on export and more on domestic demand to achieve growth. this will contribute to a more balanced development in china and the world at large. the sustained and rapid development of china ’ s economy has played an important role in the balanced development of global economy. global consumers have benefited a lot from good and cheap goods from china. companies especially the multinational ones get great profits from their investment or trade with china. some western economists have pointed out that it is the good and cheap chinese exports that made 10 years of low - inflation and continuous economic growth possible. according to the estimates of the european central bank, without the positive factor of cheap chinese exports, the price index of the euro zone would have risen 2 percentage points on average from 1996 to 2005. at the same time, china ’ s economic development pattern characterized by high input, high energy consumption and low domestic demand has brought about domestic imbalances. in terms of industrial structure, some capital intensive sectors such as the manufacturing sector have witnessed rapid development and become engines of china ’ s economic development. but agriculture and modern services have lagged behind. with respect to regional development, while the coastal areas in east china has put in place a virtuous economic development mechanism, vast middle and western areas have developed relatively slowly. as for the driving force of economic development, despite high investment and export growth rate as well as excessive energy consumption, growth of china ’ s per capita national income has been slow, and domestic consumption remains slack. some rural areas even haven ’ t got out of poverty. so china ’ s economic development mode must be transformed to support balanced development between eastern, middle and western area as well as urban and rural areas through boosting domestic demand and a new type of industrialization. second, harmonious financial development is an important part of the balanced economic development. financial industry is the core of modern economy. linking commodity market with factors of production markets and bridging production, distribution, and consumption, finance plays an essential role in resource allocation. with the deepening of china ’ s economic reform, financial industry became more and

to further open up its financial industry. china will honor its wto commitments to open the financial industry on schedule and some commitments have already been materialized ahead of schedule. but international practice also tells us over - hasty financial opening - up incompatible with the economic and financial development will exacerbate the vulnerability of financial system and thus leads to financial crisis. this will negatively affect the world economy. faced with many issues such as the industrial sector imbalance and the weak financing channels, china ’ s financial opening - up will be a long and arduous process. at the same time, financial opening - up also needs a relatively relaxed international environment. we will make efforts towards this end. we also need the understanding and support from the international society. third, shanghai ’ s growth as the international financial center will play an important role in building a harmonious financial system to build shanghai into an international financial center is a national strategy established in 1992. this strategy has two aims : one is to promote economic and financial development of the yangtze river delta and even the whole country ; the other is to develop shanghai into a window for china ’ s openingup, foreign capital utilization and international financing. thanks to fourteen years ’ development, shanghai has become the most financially advanced city in china. shanghai ’ s international financial center build - up has taken up new responsibilities in the new era characterized by the shift of development mode and the harmonious economic development. a financial center basically undertakes the function of financial intermediary and is the core part of resource allocation. home to lending, securities, foreign exchange, and insurance transaction, and sensitive to market changes, a financial center can mobilize and distribute huge funds quickly, effectively allocate financial and economic resources. an international financial center, also a center of economic and financial information, reflects regional and global economic changes, and realizes the price discovery function. the world ’ s major international financial centers have always had the above features. to build shanghai into an international financial center contributes to the cultivation of a nationwide financial system, the improvement of financial organization system, the growth of financial markets, the cooperation between regional financial institutions and the further opening up of the financial industry. shanghai ’ s growth as a financial center will serve the whole country, and promote the stability and development of the entire global economy. we hope that the experts participating in the financial culture week can come up with suggestions and proposals on transforming shanghai into an international financial center. and we also hope this financial culture