RMB Euro Direct Firing Salute To Celebrate National Day

The China Foreign Exchange Trading Center issued a document showing that in order to promote bilateral trade and investment between China and the eurozone member countries, the use of RMB and euro in trade and investment settlement will be facilitated.

The need to reduce exchange costs has been authorized by the people's Bank of China to develop Renminbi direct trading with the euro in the inter-bank foreign exchange market since September 30, 2014.

According to China Customs data, the EU is China's largest trading partner. In 2013, bilateral trade volume between China and the EU reached US $559 billion 60 million, an increase of 2.1% over the same period last year.

I believe that the direct spread of the renminbi and the euro is a milestone in the internationalization of the RMB. This is also the sixth major currency in the world after the dollar, yen, Australian dollar, New Zealand dollar and pound sterling.

In addition to the Swiss franc and Canadian dollar, the currencies of the world's recognized major economies are directly aligned with the yuan, which imply that the entire exchange rate market is developing in a more healthy direction.

I believe that throughout the history of the development of human money, whether silver standard, gold standard, gold exchange standard or the current exchange rate (paper currency) standard system, the strong rise of any country will be accompanied by the internationalization process of its own currency: in seventeenth Century, the sun will not fall, so will the western states, the United States in nineteenth Century, and the eastern lions in twenty-first Century.

Over the past few years, the development of the offshore RMB market in Europe has been developing rapidly, including London, Frankfurt, Paris and Luxemburg.

According to publicly available data, London accounted for 62% of RMB pactions in mainland China and Hongkong outside the fourth quarter of last year, far exceeding the US, France and Singapore, which accounted for only 15%, 10% and 8% respectively. Therefore, as early as March this year, the yuan was directly matched against the British pound, which further consolidated London's position as a world financial center and, of course, further enhanced the influence of the renminbi.

At the same time, with the economic rise of emerging market countries such as China, India, Brazil, Russia and South Africa, the old international financial and economic order has been constantly impacted, so the BRICs Development Bank also came into being.

After entering 2014, the unstable situation in Eastern Europe caused the rapid deterioration of relations between Russia and Western countries. Russia signed a "30 century" list of natural gas supply to China at the national level, which is up to US $about 400000000000. At the Russian level, Russia also gradually opened trade accounts such as Renminbi, Hong Kong dollar and Singapore dollar.

The author expects that the settlement of RMB and ruble has already entered the agenda of China and Russia, and the intention of dollarization is very obvious.

The latest RMB tracking report by the global bank Financial Telecommunication Association shows that the global RMB payment has increased two times in the past two years.

In August, the renminbi ranked seventh in the world's main payment currency.

The author predicts that China is now adjusting to the macroeconomic direction toward soft landing, and many problems need to be solved through currency internationalization.

With the continuous rise of the national economy, the strength of the renminbi is only a matter of time.

Instead of saying that we have confidence in our own currency, we should have a full grasp of our traditional cultural heritage and the spirit of hard work.

The writer has a good wish that the renminbi will one day become a real currency for hard labor and wealth accumulation.