Asia Economy

Chinese Finance Minister Resigns


Government officials said Thursday that Finance Minister Jin Renqing resigned for "personal reasons," amid concerns of surging inflation and just weeks ahead of an expected reshuffling of top government positions.

The State Council, or Cabinet, transferred Jin to a government think tank, where he will be deputy chief, a ministerial-level position.

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The official Xinhua News Agency said that Xie Xuren, 59, director of the State Administration of Taxation, replaced Jin. Xie has been director of the tax administration since March 2003, Xinhua said. He is an alternative member of the party's Central Committee.

No other details were given in the statement announcing Jin's resignation, read over the telephone by a spokeswoman speaking on condition of anonymity in line with department policy. That followed several days of rumors that Jin would step down. He has been finance minister since 2003.

"For personal reasons, Jin Renqing requested to resign. The central government agreed to his request and approved appointing him to be deputy director of the Development Research Center of the State Council," the spokeswoman said.

Asked Wednesday about rumors of Jin's departure, Central Bank Vice Governor Su Ning said monetary policy would not be affected by personnel changes at the Finance Ministry, a reflection of how decisions about the direction of China's economy are determined at a higher level.

However, the nation's leaders have increasingly relied on trained economists such as Jin to steer the ever-more complex domestic economy and China's foreign trade relations.

Boost in Reserves

Jin's tenure saw China's foreign currency reserves surge past $1.3 trillion, a sign both of China's foreign trade juggernaut and the government's failure to balance flows of money into and out of the economy.

China's massive trade deficit with the U.S., which hit $235 billion last year and is expected to grow this year, has put Beijing under pressure to revalue its currency. Critics say the Chinese yuan is deliberately undervalued against the U.S. dollar and other currencies to spur trade by making Chinese exports unfairly cheap.

Beijing says its currency regime is fair, but has allowed a gradual strengthening of the yuan.

Jin's transfer comes just six weeks before the opening of a Communist Party congress that occurs twice a decade. The meeting is expected to result in new appointments of senior party and government positions as well as set the policy agenda for the next five years.

Jin, 63, is one of about 200 members of the Communist Party's Central Committee, and formerly headed the State Administration of Taxation. He is also a former vice governor of the southwestern province of Yunnan and a former vice mayor of Beijing.

There was no immediate word on what factors had influenced Jin's resignation, but similar cases in the past have been attributed to marital, health or family problems. Jin is still two years below the official mandatory retirement age for officials at the central government level.

Tax Evasion Crackdown

As China's top tax collector, Jin modernized his agency to keep pace with capitalist-style economic reform as Beijing increasingly turned to revenues from private business to fund development.

Jin oversaw a highly publicized crackdown on tax evasion by the rich as part of efforts to ease public anger at the growing gap between rich and poor. A film star was arrested and others targeted included entrepreneurs and professionals.

Jin's time in office saw huge growth and development in the economy as well as concerns about overheating.

On Wednesday, the central bank said inflation was likely to exceed the government's 3 percent target for the year despite a series of credit-tightening measures to tamp down prices and cool enthusiasm for buying shares.