Monday, September 22, 2014Tweet
[IWS] USCC: [China] THE RMB's LONG ROAD TO INTERNATIONIZATION [22 September 2014]
IWS Documented News Service
Institute for Workplace Studies-----------------Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
16 East 34th Street, 4th floor--------------------Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
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U.S.-China Economic and Security Review Commission (USCC)
USCC Economic Issue Brief
No. 5 | September 22, 2014
The RMB’s Long Road to Internationalization
Nargiza Salidjanova, Policy Analyst
[full-text, 13 pages]
• Chinese authorities have used Hong Kong’s position as a global financial center to promote the use of the RMB abroad. Hong Kong is the oldest and largest market for offshore RMB transactions, and will remain so despite the emergence of several other offshore contenders.
• To date, RMB internationalization efforts have involved three main channels: offshore RMB deposit accounts and bonds, use of the RMB for cross-border trade settlement, and establishment of RMB swap lines between the People’s Bank of China and other central banks.
• Despite growth in onshore and offshore use, the RMB cannot become a true international currency until Chinese authorities liberalize China’s capital account, allowing for unrestrained movement of financial flows.
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