1. The concept of foreign exchange. Foreign exchange has both dynamic and static meanings. Dynamic foreign exchange is the abbreviation of "international exchange", that is, one country's currency is exchanged for another country's currency to pay off international creditor's rights and debts; Static foreign exchange refers to the means of payment expressed in foreign currency for international settlement.

The International Monetary Fund gives a static explanation of the concept of foreign exchange: "Foreign exchange is the creditor's rights held by monetary authorities (central bank, monetary institutions, foreign exchange stabilization fund and Ministry of Finance) in the form of bank deposits, treasury bonds and long-term and short-term government securities. It can be used when there is a deficit in the balance of payments. " The definition of foreign exchange in China's Regulations on Foreign Exchange Management is also static. Article 3 stipulates that foreign exchange refers to the following means of payment and assets expressed in foreign currency that can be used for international settlement:

(1) foreign currency, including banknotes and coins;

(2) Foreign currency payment vouchers, including bills, bank deposit vouchers and postal savings vouchers;

(3) Foreign currency securities, including government bonds, corporate bonds and stocks. ;

(4) Special Drawing Rights and European Monetary Units;

(5) Other foreign exchange assets.

2. Foreign exchange classification. According to different standards, foreign exchange can be divided into the following categories:

(1) According to whether foreign exchange is freely convertible, it can be divided into free foreign exchange and bookkeeping foreign exchange. Free foreign exchange refers to foreign currencies that can be widely used in international settlement and can be freely converted into other countries' currencies or paid to third countries at any time in the international financial market without the approval of the competent authorities of the issuing country, such as US dollars, British pounds, German marks, etc. Bookkeeping foreign exchange, also known as "agreed foreign exchange" and "bilateral foreign exchange", refers to foreign exchange that can only be used between signatory countries according to the provisions of bilateral agreements and cannot be freely converted into other countries' currencies or paid to third countries without the approval of the administrative organ of the currency issuing country. The currency used for bookkeeping of foreign exchange is agreed by the signatory countries in the bilateral agreement. It can be the currency of any signatory country, the currency of a third country, or a composite currency, such as special drawing rights and European currency units. This foreign exchange is generally recorded in the special account of the signatory bank. At the end of the year, the creditor's rights and debts between them will be written off centrally, and the difference will be transferred to the balance of bilateral trade accounts in the next year.

(2) According to the sources and uses of foreign exchange, foreign exchange can be divided into trade foreign exchange and non-trade foreign exchange. Trade foreign exchange refers to the foreign exchange within the settlement scope of import and export commodity trade, including the foreign exchange of receipts and payments and their ancillary expenses in commodity import and export trade. Trade foreign exchange is the main item of a country's foreign exchange revenue and expenditure, and occupies an important position in the international balance of payments. Therefore, it is often the main object of a country's foreign exchange management. Non-trade foreign exchange refers to foreign exchange received and paid by other means except trade foreign exchange, including foreign exchange received and paid in science and technology, cultural exchange, tourism, banking, insurance, shipping and foreign project contracting. Non-trade foreign exchange involves many kinds and is also an important item of a country's foreign exchange receipts and payments, so it is also an important object of a country's foreign exchange management.

(3) According to different holders of foreign exchange, foreign exchange can be divided into resident foreign exchange and non-resident foreign exchange, as well as unit foreign exchange and individual foreign exchange. Resident foreign exchange refers to foreign exchange held by residents of a country in various forms. Residents refer to natural persons and legal persons who live permanently or permanently in a country and are governed and protected by the laws of that country. Non-resident foreign exchange refers to various forms of foreign exchange held by foreign tourists, overseas students, overseas Chinese who have returned for a short time, foreign diplomats, consulates and diplomats in a country, and international institutions and organizations and their staff in a country. Under normal circumstances, foreign exchange management of non-residents in various countries is looser than that of residents. Unit foreign exchange refers to the foreign exchange received and paid by organs, organizations and enterprises. Personal foreign exchange refers to the foreign exchange earned and paid by individual natural persons through private channels.

(4) Foreign exchange can be divided into spot foreign exchange and forward foreign exchange according to the different delivery period of foreign exchange in the transaction. Spot foreign exchange refers to the foreign exchange settled within two business days after the foreign exchange buyer and seller reach a transaction. Forward foreign exchange, or futures foreign exchange, refers to the foreign exchange that the buyer and the seller sign a contract after concluding a transaction, stipulating the quantity, exchange rate and delivery date of foreign exchange to be bought and sold, and pay and deliver at the exchange rate stipulated in the contract when it expires. The purpose of buying and selling forward foreign exchange is mainly to avoid or mitigate the risks brought by exchange rate changes.

Second, the concept and types of foreign exchange management

Foreign exchange management, also known as "foreign exchange control", refers to administrative restrictive measures implemented by a country on foreign exchange receipts and payments, transactions, lending, transfer, international settlement, foreign exchange rate and foreign exchange market within its jurisdiction according to law. As an important part of foreign economic and trade management, foreign exchange management plays the following roles: (1) stabilizing the foreign exchange rate of local currency; (2) guard against foreign exchange risks, protect the domestic market and promote economic development; (3) Balance the country's balance of payments.

At present, all countries in the world implement foreign exchange management, but the degree of management is different, which can be divided into three types: one is to implement comprehensive foreign exchange management, that is, both current account and capital account should be controlled. Such countries are usually backward in economy, short of foreign exchange funds and underdeveloped in market mechanism, hoping to achieve the purpose of promoting economy through centralized distribution and use of foreign exchange; The second is to implement some foreign exchange controls. That is, foreign exchange control is not implemented or basically not implemented for current account foreign exchange transactions, but certain restrictions are imposed on capital account foreign exchange transactions; The third is that foreign exchange control is basically not implemented, that is, foreign exchange transactions in current and capital accounts are not subject to universal and regular restrictions.

China's current foreign exchange management system basically belongs to partial foreign exchange control. The performance is as follows: (1) the current account is convertible and the capital account is strictly controlled; (2) To supervise and manage the foreign exchange business of financial institutions; (3) Prohibiting the pricing and circulation of foreign currency in China; (4) Distinguish foreign exchange management between bonded areas and border areas. The general goal of China's foreign exchange management system reform is to create conditions for gradual liberalization, promote capital account convertibility on the basis of current account convertibility, and realize full convertibility of RMB.