REAL STRENGTH: A worker guides a transportation crane at a container harbor in Fuzhou Port, Fujian Province. Economists call on China to take extra steps to avert financial risks and refocus on real economy (ZHANG GUOJUN)

As the Wall Street chaos of 2008 swept the globe, China—with little exposure to subprime mortgages—was one of the only calm ports in the growing financial storm. If one lesson can be learned from the crisis, it is this: maintain a constant state of financial vigilance against risks even in boom times. China now faces the task of ensuring its financial health as it further opens to the world amid a global financial landscape reshaped by deep recessions. Economists and finance professors discussed these challenges at the Asia-Pacific Economic and Financial Forum recently held in Beijing. Edited excerpts follow:

Guo Tianyong (Director of the Research Center of the Chinese Banking Industry at the Central University of Finance and Economics): More than one year after the demise of Lehman Brothers, Inc., the United States is still feeling the financial aftershocks. While big banks supported by the government, like Goldman Sachs, find their feet, smaller ones are receiving devastating blows one after another. More than 100 banks across America were closed in 2009, a clear indication of the staggering weakness of the real economy.

Far from a substantial turnaround, the U.S. economy still relies heavily on fiscal and monetary expansions, which cannot be sustained. U.S. banks previously cashed in on profligate debt-leveraged consumption, but with savings rates on the rise, the banking prosperity is quickly becoming a fading memory. It will take a long time for the banks to find an alternate growth model, though the recovering strength of corporate clients may provide some respite.

The good news is the woes of the small banks may be less of a shock to the overall economy given their limited scale. Moreover, it could serve as a powerful catalyst for policymakers to strengthen regulatory supervision and build up firewalls against risks.

The need for risk aversion applies to China as well. It is understandable that banks have the impulse to increase lending while the economy booms, but if history is any guide, credit explosions could easily sow the seeds of bad loans. It is therefore necessary for Chinese banks to rationalize their lending and streamline corporate structures to fend off possible risks.

Zhu Min (Deputy Governor of the People's Bank of China): The financial crisis is sparking debate concerning a possible shift in the balance of global monetary power. The U.S. dollar's prominence as a reserve currency for making international payments and storing wealth is waning. However, finding a genuine alternative will prove difficult since no other currency stands out—neither the euro nor the Japanese yen has such a scope of use in global trade and foreign exchange reserves.

But one thing is certain—the center of the financial world is moving east, with China emerging as a pillar. One clear clue is most Asian banks have raked in juicy profits while their Western counterparts succumb to the full force of the crisis.

Such a shift is largely in line with changes taking place in the overall economy. Demurring from dangerous derivatives, the global financial industry is refocusing on services for the real economy, such as trade and regular corporate businesses. This will provide an opportunity for Asian financial businesses to draw strength from their vibrant economies.

New York can expect to face daunting challenges to hold on to its role as a global financial center, as Hong Kong and Shanghai vie for the title.

Yungchul Park (Director of the Korea Development Institute): As part of its commitment to a stronger financial industry, China is pushing for a larger role of the renminbi (yuan) as a global currency. In September 2009, the Chinese Government offered 6 billion yuan ($878 million) in renminbi-denominated bonds in Hong Kong, while jumpstarting a pilot program allowing companies in five mainland cities to settle cross-border trade deals in renminbi.

But I believe the Chinese currency still has a long way to go toward full internationalization. The painful experience of Japan 30 years ago shows us why. In the 1970s, with heavy government support, the yen was responsible for nearly 30 percent of its export settlements. An international yen, however, still looks like a distant dream, mainly because of an asset bubble crash in the 1980s and, most importantly, the lack of an open and efficient financial market.

It will therefore be necessary for China to gradually loosen control over its financial system and increase the sector's efficiency. It would also be a big help if China can accelerate financial integrations between Asian countries and promote the renminbi as a regional reserve currency.

Yi Cheng (Deputy Director of the Research Bureau of the People's Bank of China): Though their financial woes appear too shallow to justify deep concern, East Asian countries have been joining forces in self-defense.

Finance ministers from China, Japan, South Korea and the 10 members of ASEAN (Association of Southeast Asian Nations) in May 2009 announced plans to jointly set up a $120-billion foreign exchange liquidity fund to ensure the region's financial stability. The fund will offer a contingency credit line should any of the member countries come under speculative attack. It is part of international financial reforms and is expected to be a complement to the International Monetary Fund.

But establishing the fund will not be without hurdles, and stiff efforts are needed to smooth the way for the fund to become operational. For example, the huge economic and social gulfs within the region may undermine its ability to find a community response to emergencies. Unlike the European Union economies that are closely tied to each other, East Asian nations still need to seek more common ground to precipitate financial integrations. On China's part, it is also necessary to press ahead with effective coordination with other countries in the region while contributing to the development of the fund.