[Observation] RMB Internationalization Is Advancing Steadily.

The internationalization of RMB has been a hot topic at the four Lujiazui (15.59, -0.32, -2.01%) forum.

With the introduction of the RMB settlement in cross-border trade, the revision of the clearing agreement between the mainland and Hongkong, the exchange of currencies with neighboring countries, and the encouragement of enterprises issuing RMB bonds and IPO abroad, the process of RMB internationalization has also been further developed. The discussion on RMB internationalization in this Lujiazui forum is more specific and detailed.

Zhou Xiaochuan, governor of the people's Bank of China, attended the forum and pointed out that the cross border use of RMB mainly refers to Trade And the use of investment, "at the same time, it is prudent to allow for gradual use in financial transactions". Moreover, "if the cross-border use of RMB reaches a certain stage of development, there will naturally be a demand, which is that the RMB needs to be gradually and orderly convertibility". "China has announced in 1996 that it has realized the convertibility of RMB on current account. The following is the convertibility of capital account, which is also a long-term development process. It brings many new opportunities and brings many new problems."

At present, there are 20 provinces and municipalities across the country to carry out cross-border trade RMB settlement pilot, and 11 provinces and municipalities did not carry out this business. It is reported that the central bank will promote the expansion of pilot projects, and strive to expand the pilot year to the whole country.

In terms of settlement volume, the total amount of RMB settlement in cross-border trade last year was 500 billion yuan, accounting for about export trade 2% of the total. In the first 4 months of this year, the amount of settlement has reached 530 billion yuan, more than last year. At the same time, the pilot of RMB settlement in cross-border trade has expanded to 20 provinces in June 2010, and the number of pilot enterprises has increased from 365 to more than 6700.

More specific policies for the future are expected to come out. Li Bo, director of the two division of monetary policy of the people's Bank of China Attending Forum It was revealed that the central bank and the foreign exchange bureaus and other relevant departments are working together to promote the establishment of the RMB foreign debt management system and facilitate investment facilitation. In addition, the central bank is also studying the relevant methods of RMB settlement (i.e. RMB FDI) for foreign direct investment. In January this year, the central bank and the foreign exchange bureau, together with the Ministry of Commerce and other departments, issued a pilot scheme for RMB settlement of foreign direct investment, that is, RMB ODI, so far the pilot volume is about 19 billion yuan.

In regard to overseas direct investment, Xu Quan, deputy director of the office of Shanghai financial affairs office, said that overseas direct investment mainly involves non-financial investment, mainly emigration investment, real estate investment and enterprise investment. At present, the relevant departments of the state have not formally approved any foreign investment of a city resident. Last year, Shanghai has been reported to the State Council, and is now collecting the opinions of the relevant departments. It has not been approved yet, but Shanghai will actively promote the work after the completion of the procedures.

"Overseas direct investment RMB settlement pilot and cross border trade RMB settlement cooperate with each other, thus greatly improving the circulation of RMB funds overseas and broadening the channels for RMB supply in overseas markets. At the same time, as China's overseas direct investment nearly 90% to the emerging market, this is the most potential area for RMB demand, so this new pilot will also help to meet the demand for RMB settlement in emerging markets. Huang Bijuan, chief executive of HSBC (China), said that in the process of RMB internationalization, offshore and onshore markets can cooperate with each other and form joint efforts to push forward together.

In addition, the return of RMB has also become a hot topic in the Forum on RMB internationalization. Many financial institutions senior officials and officials mentioned the problem of foreign currency repatriation during the forum. It is believed that the continuous introduction of new measures will help to establish cross border circulation path of people's money funds.

Ling Tao, deputy director of the central bank's Shanghai headquarters, also said in the forum interaction that the cross-border use of RMB should be further promoted in the future. It is hoped that Shanghai and Hongkong will have a different division of labour in the next step to promote cross-border use, so that Hongkong can become an offshore center of RMB and use Shanghai's financial resources to gather back to the renminbi.