Friends, do you think this is a bit of a? China, as the world's second largest economy, why is the RMB not so valuable when it "goes out"? Americans don't recognize the yuan? It's a laughable joke! In this era of globalization, how did our RMB fall into such an embarrassing situation? Don't worry, today let's talk about the story of RMB internationalization, see what it has gone through, and how to solve the dilemma.
(Which countries support RMB settlement at the end of the article)
The Renminbi's "International Journey"
When it comes to the renminbi, it is booming in China, with the circulation and payment share soaring. But once we step out of the country, it's a very different story. In many countries, merchants only accept US dollars, not even their own national currency, let alone our renminbi. Think about it, we took RMB to travel and go shopping, only to be told "I'm sorry, we don't accept this". Isn't this feeling like being poured a basin of cold water, cold from head to toe?
Then again, why is this dollar so unimpeded around the world? In fact, behind this is the support of the US economy. Why has the U.S. dollar become the world's "hard currency"? In contrast, the internationalization of our RMB is a bit bumpy. Are there many deep-seated reasons behind this?
The dream of a strong country behind strong coins
In the final analysis, the value of a currency depends on the economic strength of a country. Although China's economy is developing rapidly, there is still a certain gap between China and the United States. In particular, we still have a long way to go in terms of innovation-driven and high-quality development. As a result, the renminbi is not recognized enough in the international market, and everyone's confidence in it is also insufficient.
Again, our RMB exchange rate formation mechanism is not market-oriented enough, and the degree of openness of the financial market is not high enough. This has greatly reduced the interest of international investors in the renminbi. After all, everyone likes to invest in stable, transparent, and promising currencies. And our renminbi needs further efforts in this regard.
Of course, these problems are not solved overnight. The good news is that we have seen the dawn of RMB internationalization. In recent years, the proportion of RMB in cross-border trade settlement and commodity trading has been increasing. In particular, with the deepening of the construction of the "Belt and Road", the influence of RMB in Central Asia, Southeast Asia and other regions has increased significantly. These are all important developments in the internationalization of the RMB!
Where is the way to solve the dilemma?
Next, how can we further promote the internationalization of the RMB? First of all, we must continue to deepen reform and opening up and create a good business environment. Let more foreign investors see the potential of our Chinese market and be willing to invest and allocate RMB assets. In this way, the internationalization level of the renminbi can be further improved.
Deepen the reform of the capital market and promote the formation of RMB asset pricing power. This makes RMB assets more attractive and competitive in the international market. In this way, everyone will be more willing to hold RMB assets, and the international status of RMB will be enhanced.
In general, we need to expand the use of RMB in cross-border trade, investment and financing. Let more countries and regions accept and use RMB. In this way, the renminbi can play a greater role in the world.
Conclusion: What can we do to internationalize the RMB?
Having said all this, in fact, the internationalization of the renminbi is not an easy thing. It requires the joint efforts and continuous promotion of the whole society. However, as long as we strengthen our confidence and persistently promote reform and opening up, deepen the reform of the financial market, and expand the scope of international use of the renminbi, I believe that in the near future, the renminbi will certainly be able to occupy a more important position in the international monetary system.
So finally, I would like to ask you a question: how long do you think it will take for the internationalization of the RMB to be realized? In this era of globalization, what can each of us do for the internationalization of the RMB? Let's cheer for the internationalization of the RMB! Perhaps, a small suggestion or action of yours can have an unexpected impact on the internationalization of the RMB