China's Currency and IMF Issues

China’s currency policy is one of the most hotly debated subjects in recent international monetary history. This chapter sets out the current legal framework at the International Monetary Fund (“IMF” or “Fund”) governing its members’ exchange rate policies, and the global system of exchange rates. In doing this, the chapter notes the rationale underlying the current framework, assesses the IMF-consistency of China’s policies, and reviews proposed reforms of the framework. We conclude that it would not appear that China is in breach of its obligations under Article IV, Section 1, but that legitimate concerns have been raised over the adequacy of Section 1 with regards to members’ obligations and the Fund’s oversight role