Feel the "international model" of RMB from New changes

Since the end of October, the People's Bank of China has successively released information to introduce the latest progress and trend outlook of RMB internationalization. A series of data shows that the function of the RMB as a payment currency, investment and financing currency, and reserve currency is increasing, and it is becoming more and more popular in the international market. The People's Bank of China said that the next step should be to follow the trend, balance development and security, and steadily promote the internationalization of the renminbi.

What is the future of RMB internationalization? The sound of optimism from all walks of life continues to increase. Statistics show that about 82.8% of the surveyed domestic and foreign business enterprises are considering using RMB in cross-border transactions or increasing the proportion of RMB use, which reached the highest level in recent years

Argentina recently made it clear that it will use the equivalent amount of RMB under the currency swap agreement between China and Argentina to repay the International Monetary Fund's foreign debt and interest due in the near future, which is another choice after Argentina used RMB to repay the maturing foreign debt at the end of June this year. Argentina officially launched RMB clearing bank services in November last year, and then the National Securities Commission of Argentina approved the issuance of securities products settled in RMB, which is a reflection of Argentina's welcome to the internationalization of RMB.

In Bolivia, the local government announced in July that the state-owned Union Bank of Bolivia would start renminbi trading. Marcelo Montenegro, Minister of Economy and Public Finance of Bolivia, said that the country's RMB trading business has got off to a good start and is looking forward to better use of RMB under the "Belt and Road" cooperation framework. More and more countries have started RMB business, RMB internationalization is developing rapidly, and RMB is expected to participate more in international trade activities in the future.

More companies have also expressed confidence in the yuan. Recently, the People's Bank of China released the 2022 annual RMB International Use market survey. According to the survey of more than 3,600 domestic and foreign business enterprises, about 82.8 per cent of the surveyed domestic and foreign business enterprises are considering using the renminbi in cross-border transactions or increasing the proportion of the use of the renminbi, the highest proportion in recent years. 71.8% of the surveyed overseas industrial and commercial enterprises will give priority to using RMB as a trade financing currency in China, which is 3.5 percentage points higher than the survey result in 2021, and the intention of overseas enterprises to use RMB for trade financing in China is the highest in the past three years.

At present, the diversification of the international monetary system is accelerating, the internal demand for the use of RMB by business entities is increasing, and the international environment is also complex and volatile. The internationalization of the RMB should follow the trend, continue to adhere to the principle of market-driven, mutually beneficial and win-win results, pay more attention to improving the quality and level of the RMB, focus on trade and investment facilitation, continue to improve the basic institutional arrangements for cross-border RMB investment and financing, and transaction settlement, enhance the ability of cross-border RMB business to serve the real economy and promote high-quality development, and provide economic entities with diversified currency choices. We will steadily promote the international use of the RMB. At the same time, adhere to the principle of seeking progress while maintaining stability, constantly improve the regulatory capacity and risk prevention level under the condition of opening up, and build a strong "breakwater" to ensure the steady progress of RMB internationalization under the premise of holding the bottom line of safety.