Zhou Xiaochuan

Zhou Xiaochuan
Zhou Xiaochuan
Zhou Xiaochuan & John W. Snow
11th Governor of the People's Bank of China
Assumed office
December 2002
Premier Wen Jiabao
Preceded by Dai Xianglong
Personal details
Born January 29, 1948 (1948-01-29) (age 63)
Yixing, Jiangsu
Nationality Chinese
Political party Communist Party of China
Spouse(s) Li Ling[1]
Alma mater Beijing Institute of Chemical Technology
Tsinghua University

Zhou Xiaochuan (Chinese: 周小川; pinyin: Zhōu Xiǎochuān) (born January 29, 1948) is a Chinese economist, banker, reformist and bureaucrat. As governor of the People's Bank of China since December 2002, he has been in charge of the monetary policy of the People's Republic of China.

He has previous held leading posts in trade and finance organizations such as Vice-Governor of the People's Bank of China, Director of the State Administration of Foreign Exchange, Governor of China Construction Bank, and Chairman of the China Securities Regulatory Commission. Zhou is associated with Zhu Rongji and the Shanghai clique of politicians.

Zhou is one of the most influential economic figures in the world and was ranked 4th by Foreign Policy in the Top 100 Global Thinkers report of December 2010.[2]


Early life

Zhou Xiaochuan was born in Yixing, Jiangsu province as the son of Zhou Jiannan and Yang Weizhe (杨维哲). The elder Zhou, persecuted during the Cultural Revolution, became a member of the State Council and the Minister for Machinery Industry in the early 1980s. He was also said to have been one of the mentors of Jiang Zemin.


Zhou Xiaochuan graduated from Beijing Institute of Chemical Technology (now Beijing University of Chemical Technology) in 1975 and received a PhD degree in economic systems engineering from Tsinghua University in 1985.[3]


Zhou is married to Li Ling who runs the Treaty and Laws department of China's Ministry Of Commerce which has played a central role in handling China's trade disputes with the United States under the World Trade Organization. Forbes referred to Zhou and Li as a "Chinese power couple that the Obama administration has to watch out for in the coming years, as the U.S. tries to defend its position in the world economic pecking order."[1]


By 1986, he was working in the State Council on economic restructuring as a member of the Economic Policy Group of the State Council and Deputy Director of the Institute of Chinese Economic Reform Research. He served as Assistant Minister of Foreign Trade from 1986 to 1989 and, between 1986 and 1991, was also a member of the National Committee of Economic Reform. Before the Tiananmen Square protests of 1989, Zhou was an associate and protege of Zhao Ziyang.[citation needed]

Between 1991 to 1995, he was executive director and vice president of Bank of China. From 1995, he assumed the position of Administrator of State Administration of Foreign Exchange. From 1996 to 1998, he served both as Deputy Governor of the People's Bank of China and Administrator of the State Administration of Foreign Exchange.[4]

During 1998 to 2000, he served as president of the China Construction Bank[4] and oversaw the creation of asset-management companies charged with working out the banking system's bad debt. He also played a part in managing China's vast foreign exchange reserves.

From 2000 to 2002, Zhou was the chairman of the China Securities Regulatory Commission. Whilst there, he earned the nickname Zhou "Bapi" (周扒皮) - literally Zhou "the flayer". He targeted corruption in listed companies, angering many small shareholders who saw their shares fall. In July 2001, Zhou Xiaochuan declared his intention to reduce state ownership in the stockmarket. The stockmarket quickly went into freefall, forcing him to abandon his plans that October.[citation needed] He emphasized the role of market mechanisms and worked to reduce red tape and aimed to protect retail investors.[5]

In December 2002, he was appointed to his present position as governor of the People's Bank of China and also took over the position of chairman of monetary policy committee of the People's Bank of China from January 2003.[4] Currently, he is serving his second and final five-year term.[5]

As leading banking authority, Zhou is in charge of clearing up some $865 billion bad loans in the Chinese banking system. Recently (as of October 2010) he has also been under pressure from the finance ministers and central bankers of the G7 countries, to revalue the Renminbi and change its exchange rate-setting mechanism.

Zhou has published a dozen monographs and over one hundred academic articles in Chinese and international journals. His articles "Rebuilding the relationship between the enterprise and the bank", "Social security: reform and policy recommendations" and book Marching toward an open economic system (走向开放型经济) have all won awards in China.

He is generally considered the most academically capable of the current Chinese leadership, being praised for his intellect and diplomacy. He has been called "China's most able technocrat" and is the only highly-ranked Chinese politician to have been published in a Western academic journal. Although he has yet to reach the highest rungs of decisionmaking within the State Council, he is considered a strong and vocal advocate of further liberalization in the financial sector. He has increasingly displayed an openness to the press - rare for a senior Chinese official - and is most famous for the motto: "If the market can solve the problem, let the market do it. I am just a referee. I am neither a sportsman nor a coach."

His career has been devoted to economic reform. To that end, Zhou has had a preference for recruiting overseas educated and trained Chinese (locally called "sea turtles"), who have experience of real capitalist markets.

Zhou had been suggested as a future premier, but some consider that he did not have the political experience.[citation needed] On January 15, 2006, however, the Financial Times of London called him "a rising political star and widely expected to be promoted to vice-premier in the next major reshuffle of top party and government posts, due in late 2007 and early 2008."[citation needed] This did not materialise however, with the post instead going to Li Keqiang.

International monetary system reform

On March 24, 2009, Zhou gave a speech entitled Reform the International Monetary System, in which he argued that the ongoing financial crisis was made more severe by inherent weaknesses of the current international monetary system and called for a gradual move towards using IMF Special Drawing Rights (SDRs) as a centrally managed global reserve currency. He argued that this would address the inadequacies of using a national currency as a global reserve currency, particularly the Triffin dilemma—the dilemma faced by issuing countries in trying to simultaneously achieve their domestic monetary policy goals and meet other countries' demand for reserve currency. Zhou explained global currency diversification was needed because an over-concentration of foreign assets denominated in the dollar may bring about undesired consequences. Zhou argued that it was regrettable that John Maynard Keynes's "farsighted" Bancor proposal was not adopted at Bretton Woods in the 1940s.[6][7]

Zhou also asserted China's increasing confidence in its own financial governance philosophies. He criticized western leaders for letting their banking sectors go astray due to loose regulations.[8]


External links

Government offices
Preceded by
Dai Xianglong
Governor of the People's Bank of China
Succeeded by

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