Export of the RMB settlement of cross-border trade in the number of pilot enterprises increased from 67 359 365 in one fell swoop. Continue to push forward the process of internationalization of the RMB, the present situation is still hard to be optimistic.

How to quantify the degree of internationalization of the RMB? At present the extent of its international reach? This is the Shanghai Banking Regulatory Bureau, deputy director Zhang Guangping recent thought.

China’s economy in the world compared to the proportion of the RMB in the international foreign exchange market turnover was lower proportion of the domestic financial market development there are still many problems, some varieties trading atrophy.

Shanghai recently held a forum on wealth management, internationalization of the RMB, and its balance sheet, reserves and investment function of financial market transactions require support. RMB settlement to promote the same time, we must focus on the foreign exchange market and other financial market developments, there is no financial market mutual support and coordinated development, a single function can not be sustained.

Successive years of decline in the currency’s international status

According to Bank for International Settlements (BIS) published data every three years, RMB 2007, average daily share of global foreign exchange turnover ratio of 0.5% in April this year had fallen to 0.3% of the turnover ranking dropped from No. 20 to 24. HK during this period from 2.7% to 2.4%, but still the eighth-largest currency.

A foreign exchange transaction consists of two currencies, BIS listed daily average of a currency in the global foreign exchange turnover in the accounting data, is based on the total proportion of 200% of the sum, so the actual inspection of a proportion of national currency should be divided by 2 on the basis of BIS data.

Accordingly, the degree of internationalization of the RMB currency has been declining in recent years, arguments, from 4% in 2007 down to 1.6% in 2010. In the BIS ratio of global trade accounted for more than 0.1% of the 33 currencies, only 5 countries in 2010, the degree of monetary parameters of the international decline in 2007, the three Scandinavian currencies, the South African rand and RMB, and the yuan the largest decline.

We push the yuan trade settlement in the clearing function, but the figures show that our emphasis is not high. Planning basically built in Shanghai international financial center by 2020, when the degree of internationalization of RMB is the circumstances?

2004-2010, China’s economy grew from 4% to 9.3% average annual growth of 0.9%. 0.7% of total annual growth, China’s economy in 2020 up to the global share of 16.3%. Parameters with the degree of currency of international minimum 15% growth is expected to be RMB currency will push the global anti-accounting for about 2.4%.

In 2010 to 2.4% of HK is the world’s eighth largest proportion of home currency.

Five current international monetary reserve currency of the parameters of the mean degree of internationalization is 120%, up to 168.8%. Renminbi to U.S. dollars in 2020, second only to the third major currencies and the euro, which reached the international level parameters to be 119%, but this possibility is relatively small; if that time to become the world’s fifth-largest currency, the parameters to be from 2010 from 1.6% to 47.7% in 2020.

Shrinking part of the financial market transactions

In 2020 to become the fifth largest international monetary goal to push the yuan against the internationalization process, the situation is not optimistic.

First, foreign exchange forward two consecutive years of declining business. According to central bank data, the year 2008 the amount of foreign exchange forward transactions of RMB 17.8 billion U.S. dollars, but in 2009 only 9.8 billion U.S. dollars, third quarter 2010 was 72 billion U.S. dollars, quarter by quarter and showed a downward trend.

Domestic interest rate forward agreements do not see sustained growth. The poor development of financial markets, the factors themselves is not conducive to the process of internationalization of the RMB.

Data show that the domestic interest rate forward agreements since the first three quarters of 2007 only 188 deals took place, involving only a nominal amount of 20.25 billion yuan, and the first three quarters of this year, only 10 transactions.

Prior to the difference between the delivery of foreign exchange forward business permit, but later regulators against domestic institutions and residents in offshore yuan derivatives such as NDF, the business must be fully deliverable forward, resulting in a shrinking business. But with the recent introduction of the new central bank foreign exchange management practices, on the bank’s daily foreign exchange settlement positions limit the implementation of management cash basis, the bank to hedge foreign exchange risk will increase their long-term business.

The forward interest rate agreements, interest rate swaps due to its similar, but shorter term, traders told this reporter, more of less the 5-year interest rate swap business, short term interest rates more than long-term business development.

However, with the promotion of cross-border settlement, degree of internationalization of RMB is indeed gradually increased. The third quarter of this year, the RMB settlement of cross-border trade volume of nearly 200 billion in the third quarter, exports accounted for RMB, the proportion of imports and trade settlement were 0.44%, 4.61% and 2.35%. Zhang Guangping estimated annual total amount of RMB settlement of accounts for foreign trade will be about 2%.

And because the RMB in Hong Kong an important role in cross-border settlement, he believes that cross-border capital flows and the effective supervision of cross-border business under the premise in place, Hong Kong, the RMB may become the most important product channels.

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