I. Foreign exchange and foreign exchange management

Foreign exchange refers to the means of payment and assets that can be used for international settlement. According to the Regulations on Foreign Exchange Control, foreign exchange includes foreign currency, foreign exchange payment vouchers, foreign currency securities, special drawing rights, European currency units and other foreign currency assets. According to the different characteristics of currencies in international settlement, foreign exchange can be divided into free foreign exchange and bookkeeping foreign exchange.

Foreign exchange management, also known as foreign exchange control, refers to a management system in which a country imposes certain restrictions on foreign exchange transactions, loans, transfers, receipts and payments, international settlement, foreign exchange rates and foreign exchange markets in order to maintain the balance of international payments. Its purpose is to maintain the balance of international payments, limit capital outflow, prevent foreign exchange speculation and promote the healthy development of domestic economy.

According to the Regulations of People's Republic of China (PRC) on Foreign Exchange Control, the system of statistical declaration of balance of payments is implemented, and all units and individuals with balance of payments must declare the balance of payments.

II. Framework of foreign exchange management system

Since the founding of People's Republic of China (PRC), foreign exchange control has been implemented. In the early days of the People's Republic of China, based on the weak national strength and the severe international and domestic situation at that time, a strict foreign exchange management system was implemented. With the continuous development of reform and opening up and economy, a series of new laws and regulations on foreign exchange management have been promulgated one after another, forming a relatively complete legal system on foreign exchange management based on the Regulations on Foreign Exchange Management of People's Republic of China (PRC), including other foreign exchange management laws and regulations, administrative regulations and other normative documents, which marks that China's foreign exchange management has entered a new era.

At present, the functional department of foreign exchange management is the State Administration of Foreign Exchange and its branches.