The China currency is called the Renminbi that means 'The Peoples Currency'
and the popular unit is Yuan. The Communist Party shortly before the takeover
of the mainland issued Renminbi in 1949. During the communist era the value of
RNB was maintained on unrealistic values in exchange with the western currency.
But in the 1980's and 90's the RNB was made more convertible.
The official rate of exchange between the Yuan and the U.S. Dollar is 1:8 that
is USD 1 = 8 Yuan. Further 1 Yuan is equal to 10 Jiao and 1 Jiao is equal to
10 Fen. China currency is issued in the following denominations: one, two, five,
ten, twenty, fifty and one hundred Yuan; one, two and five jiao; and one, two
and five fen. The currency code of Chinese Yuan is CNY. The People's Bank of
China, the PRC's monetary authority, issues the China currency. RMB is issued
both in notes and coins. The denominations of paper notes include 100, 50, 20,
10, 5, 2 and 1 Yuan; 5, 2 and 1 jiao; and 5, 2 and 1 fen. The denominations
of coins are 1 Yuan; 5, 2 and 1 jiao; and 5, 2 and 1 fen.
Form 1994 to July 2005 the policy has been to peg the value of RNB against
the USD. But in 2003 the fall in the value of Dollar caused the RNB to also
fall thereby making the mainland Chinese exports competitive. The subsequent
pressures by US to increase the Yuan rate have been taken critically. Some scholars
maintain that the China currency is undervalued because the People's Republic
of China forbids the citizens form moving the currency abroad. But on the other
hand the free valuation is complicated. The appreciation of Yuan would make
the PRC government to buy fewer US treasury bonds thereby causing the bonds
prices to fall and bonds yields to rise affecting the US economy. The depreciation
of USD can lead to oil prices difficult to reached by the US economy and also
lead to massive unemployment.
Travelers may exchange foreign currency cash or checks at Bank of China offices
or exchange counters at the published exchange rates. These bureaus would issue
a foreign exchange statement that shall be valid for 6 months. There is no limit
on the amount of foreign currency and foreign exchange bills that can be brought
into China by tourists, but it must be declared to the customs. RMB should be
converted back into foreign currency with the personal valid "foreign exchange
certificate" before leaving China.
|
