Zhou Xiaochuan - Career

Career

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 protégé of Zhao Ziyang.

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.

During 1998 to 2000, he served as president of the China Construction Bank 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. He emphasized the role of market mechanisms and worked to reduce red tape and aimed to protect retail investors.

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. Currently, he is serving his second and final five-year term.

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. 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." This did not materialise however, with the post instead going to Li Keqiang.