depreciated the exchange rates of the RMB with the currencies of some of its main trade partners, which only narrowed the range of the appreciation of the RMB against these foreign currencies, but did not reverse the trend of the overall appreciation of the RMB. The exchange rate of the RMB with the US dollar has basically remained stable--a policy adopted by China since the outbreak of the Asian financial crisis. This, however, has not changed China's managed floating exchange rate system based on the supply and demand in the market. Practice proves that this exchange rate system suits China's current economic development stage, the bearing capacity of enterprises and the financial sector's supervision and regulation level, and conforms with China's national conditions. It is beneficial to China, Asia and the world at large. It also helps propel foreign trade, lower enterprises' costs of production, attract overseas investment, implement the central bank's monetary policy, and curb the trend of deflation. China would continue to implement the managed floating exchange rate system based on market supply and demand on the premise of maintaining the basic stability of the RMB exchange rate, timely improve the RMB exchange rate formation mechanism, and complete the foreign exchange market. In addition, efforts will be pooled to coordinate interest rate and exchange rate policies so as to promote the coordinated development of domestic and global economies.

Further more, China's economic boom means opportunities and contributions but not threats and challenges to the world.

First, it is manifested by China's contribution to global economic growth. According to the data published by the World Bank shows that between 1980-2000, the United States ranked first in the contribution to global GDP growth, with the rate reaching 20.7 percent; China came second, with the rate standing at 14 percent; and Japan ranked third, with the rate coming to 7 percent.

Second, it is manifested by China's contribution to global trade growth. Between 1980-2000, the contribution of the United States and Japan to the