well. a sound financial ecologic environment comprises not only comprehensive and integrated institution building on a macro basis, but also improvements in micro infrastructures related to corporate governance, credit culture both for individuals and enterprises, bank - enterprise relationship, intermediary services, etc. with regard to the financial ecology construction, great efforts have been made to enhance the legal system building, engaging in the research, deliberation and draft work on some related clauses in the “ property law ”, “ enterprises insolvency law ” and the “ criminal law ” in terms of property right and financial claim protection and the definition of financial crimes. on the other hand, a nation - wide publicity campaign concerning financial ecology construction has been launched to create a sound institutional and public environment, so as to ensure various enterprises develop on an equitable basis. these financial reform measures not only stressed the market - based orientation of china ’ s financial reform, but also reflected the goals of our reform to create a favorable environment for enterprises. the people ’ s bank of china will continue to push china ’ s financial reform forward in a steady manner, guaranteeing a better monetary and financial environment for enterprises. taking future development trend into consideration, china ’ s economy is expected to enter a stage characterized by steady growth. currently china is speeding up its urbanization and industrialization process with corresponding growth in investment and demand. consumption is expected to expand further due to the large population ; steady increase of household income and an upgraded consumption structure will also benefit consumption ; and favorable external environment will continue to serve a strong engine for china ’ s economic growth. all these positive factors will provide a sound macro economic environment for the deepening of financial reform. now i would like to share my insights with you on the financial reform and development trend closely related to the development of enterprises. first, continue to pursue a sound monetary policy. in 2006, china will continue with its sound monetary policy, measures will be taken to maintain the steady growth of money and credit, monetary policy will play a greater role in keeping rmb value stable and managing the equilibrium of money and credit aggregates. based on the changes of economic and financial situation, pbc will maintain appropriate growth of money and credit by using a mix of monetary policy instruments in a flexible manner and controlling the scale of policy. efforts will be made to provide quality financial services to enterprises by strengthening the coordination between rmb and foreign currency policies, and improving the formation mechanism of rmb interest rate and exchange rate.

communications and schroders group from the uk jointly established the bank of communications & schroders fund management co. ltd., deutsche bank ag bought equities of harvest fund management co. ltd. and belgian company invested in fushi fund management co. ltd in shanghai etc. second, china and europe have made a series of great progress in financial strategic cooperation. hsbc holding became the strategic investor of the bank of communications ; royal bank of scotland became the strategic investor of the bank of china ; bnp paribas invested in the nanjing commercial bank and became its strategic investor ; bausparkasse schwabisch hall ag and china construction bank together established the sino - german bausparkasse in tianjin. third, financial cooperation between china and europe via hong kong is in even greater scale. as the frontline of china to open up to the outside world, hong kong has 35 licensed banks from the european union, such as bnp paribas peregrine, deutsche bank, among the 167 licensed banks under the hkma regulation and 126 licensed securities future traders, consulting companies, asset management companies and other licensed financial intermediaries held by european shareholders among the total licensed financial intermediaries under the supervision of hong kong securities regulatory commission. furthermore, there are 1422 funds authorized by the hong kong securities regulatory commission to operate in hong kong are registered in europe. at end - 2004, net assets of those european funds reached over usd500 billion. financial development between china and europe will bring not only new challenges but also new opportunities for both sides to strengthen cooperation in financial services and regulation. china and europe have already set up bilateral financial services cooperation projects before, and the people ’ s bank of china as well as the china banking, securities and insurance regulatory authorities, have conducted and benefited from broad business exchange and collaboration with their european counterparts. in future, both sides will continue to strengthen exchange, understanding and cooperation to promote further development of their bilateral relations. ladies and gentlemen, china is making efforts to deepen financial reform and improve financial market openness. in particular, after the wto accession, china is conducting financial opening - up in line with the wto commitments. the third plenum of the 16th cpc central committee held in october 2003 pointed out that, china will boost opening - up in full scale, improve institutional protection of opening - up, advance the facilities of trade and investment, introduce more and more advanced technology, management experiences and qualified personnel,