Since 1999 there has been a devolution of approval authority to relevant local State Administration of Foreign Exchange (SAFE) branches. The restructuring parallels with the restructuring of the People's Bank of China and is a way of making the foreign exchange administration more effective and less bureaucratic in order to attract investors. It also aims at strengthening national level SAFE control at the local level. SAFE now has nine regional instead of provincial branches, which cut across provincial boundaries, that is they are less limited in their jurisdiction. It is hard to tell whether this new system will yield good results since it seems that SAFE wants to both keep the control and at the same time improve efficiency. Concerning foreign exchange purchases regarding FIE equity transfers, there seem to be two views. One the one hand, SAFE officials assert that devolution of authority should be pursued also in that area. On the other hand, there also seem to be concerns about the remittance of foreign exchange proceeds to Chinese parties.
