China is seeking to become a member of the Financial Action Task Force on Anti-Money Laundering (FATF), a major inter-governmental organization, China's central bank said Tuesday.

China's observer status at the organization that was launched in 1989 by the G7 Summit, which was granted in January this year, marked a further development in the nation's drive to combat the growing threat of money laundering and terrorism funding through international cooperation, the bank said previously.

The nation's economic growth and anti-money laundering campaign will lay a solid foundation for its participation in fighting the scourge, Zhou Xiaochuan, governor of the People's Bank of China, told the second plenary meeting of the Eurasian Group on Combating Money Laundering and Financing of Terrorism (EAG) in Shanghai Tuesday.

The establishment of EAG in October last year and its effective functioning has provided a platform for member countries to pool resources, Zhou said.

China has stepped up efforts to fight money laundering activities in the past few years, which analysts say are on the rise as crimes such as smuggling and drug dealing produce huge amounts of dirty money.

The amount of money laundered in the country every year is estimated at US$20 billion.

In the latest development, the State Administration of Foreign Exchange said yesterday police recently smashed an illegal money market in Shanghai. Illegal transactions at the market totalled 200 million yuan (US$24 million) in last September alone.

(China Daily April 13, 2005)