Financial development is crucial to the economic reform of China, especially in the areas of trade and investment.
The performance of various types of capital resources in the economic reforms of China are of great interest to those involved in the reforms as policymakers, scholars, and businesspeople. Four major areas of financial development are identified—banking and loans, trade and foreign direct investments, official flows and foreign exchanges, and the stock market. The quality, or efficiency, of the capital resource has not been given equal weight with quantity, as it is difficult to measure the quality of a resource, and because more of a capital resource is generally preferred to less. A comprehensive analysis of trade and investment issues in China has been provided.