A Decade of RMB Internationalization

Show full item record

Title: A Decade of RMB Internationalization
Author: Cheung, Yin-Wong
Organization: Bank of Finland
Department / Unit: BOFIT – Institute for Economies in Transition
Series: BOFIT Policy Brief
ISSN: 2342-205X
Series year: 2020
Series number: 13/2020
Year of publication: 2020
Publication date: 21.12.2020
Pages: 39
Subject (yso): valuutat; valuuttamarkkinat; valuuttakauppa
Keywords: Bofit-kokoelma; RMB; Kiina; SDR
JEL: F02; F31; F33; G15; G18
Other keywords: economic and non-economic factors; global currency status; offshore RMB market; policies promoting international uses
Abstract: This article recounts China’s renminbi (RMB) internationalization experiences since the 2009 RMBcross-border trade settlement initiative. In the first few years, the RMB made inroads into global financial markets and had a few remarkable accomplishments, including the Special Drawing Right currency status. Since the 2015 market turmoil, RMB internationalization has levelled off – possibly due to changes in both domestic and geopolitical conditions. The RMB is currently under-represented in the global market compared with China’s economic importance. China’s deliberate and schematic policies will elevate the RMB’s global stature in a gradual manner but there will not be a leapfrogging in the near term.
Table of contents: Contents Abstract ....... 3 1. Introduction...... 4 2. Policies to promote RMB internationalization...... 5 2.1 Local RMB clearing banks ....... 5 2.2 Bilateral local currency swap agreements...... 6 2.3 The RQFII program ...... 7 2.4 Other policy measures....... 7 2.4.1 The SDR...... 7 2.4.2 Commodity pricing ....... 8 2.4.3 International initiatives ....... 9 3. The RMB’s global status........ 9 3.1 Global FX trading ....... 9 3.2 Share of global reserves....... 10 3.3 Use in world payment transactions......... 12 3.4 The Renminbi Globalization Index......... 12 4. Offshore RMB trading ........ 13 5. RMB internationalization in retrospect...... 15 5.1 A decade of ups and downs........ 15 5.2 Multipronged strategy: positive and negative factors........ 16 6. Final thoughts....... 18 References........ 19 Appendix........ 24
Rights: https://helda.helsinki.fi/bof/copyright


Files in this item

Total number of downloads: Loading...

Files Size Format View
bpb1320.pdf 562.2Kb PDF View/Open

This item appears in the following Collection(s)

Show full item record