Bank chief stresses financial security for more open China

BEIJING - China must build a more effective financial security system to cope with possible overseas attacks or sanctions, according to the governor of the country's central bank.

Financial security is essential to a national security, and the success of financial reform hinges on stability in the sector, Zhou Xiaochuan said in an article published in the People's Daily on Wednesday.

He called for a mechanism to be put in place to monitor and counter risks, and for better regulations against money laundering and terrorism financing.

The article came as China pushes to open its financial market to overseas investors. The process, while creating unprecedented opportunities, also brings growing risks that demand tougher safeguards.

Zhou said in the article that minimizing financial risk will be a key challenge for China over the period covered by its new Five-year Plan.

Nevertheless, he said China will stick to its opening-up policy in the financial arena, allowing foreign investments to enter more industries such as banking, securities and insurance.

China will gradually realize the yuan's convertibility under the capital account, and push for the currency's entry to the International Monetary Fund Special Drawing Rights basket, the central bank governor added.