However, the RMB is not a freely convertible currency, the capital account is not open, and the RMB cannot be bought and sold freely. At present, China's RMB can only be freely convertible under current account, but not under capital account, which has become the biggest obstacle to the internationalization of RMB in the future.
The real internationalization of RMB requires many supporting measures and responsibilities. Therefore, the internationalization of RMB is a long process, and now there is only a good opportunity. To sum up, there are three advantages: first, there are a large number of foreign exchange reserves in US dollars, and people holding RMB is equivalent to holding US dollars in a sense. In other words, it is equivalent to China issuing RMB to neighboring countries and regions with US dollars as its reserve. Second, there is a trade deficit with quite a few Asian countries. Unlike Japan, Japan has failed to start the internationalization of the yen for many years. It used to have a trade surplus with these countries, and people couldn't hold the yen. China now has a trade surplus with the United States and Europe and a regional deficit with many Asian countries, which is a good condition. Especially in the current financial crisis, the instability of the dollar value is undoubtedly a good opportunity. The third is the Chinese community. Mundell, a famous Nobel laureate in economics, stressed that China should strengthen monetary cooperation among the four places. Hong Kong has now felt that there is a problem with the close link with the US dollar, especially since the RMB has been circulated in Hong Kong.
In addition, China must have a mature financial market, be able to provide more financial products denominated in RMB to neighboring countries, promote the development of Asian bond market denominated in RMB, lay a financial market foundation for the formation of currency reserve function, reduce excessive dependence on the US dollar bond market, and create investment channels for foreign RMB holders.
Of course, the most important thing is to continuously enhance national strength. A strong currency must be backed by a strong and efficient economy. The ups and downs of the economy will definitely make the currency ups and downs, so the stable economic growth is also an important prerequisite for the internationalization of the RMB. A strong country determines a strong currency, and its monetary status is supported by strong economic strength and comprehensive national strength.
Since the reform and opening up, China has gradually developed into an international trading power. In 2007, the proportion of foreign trade in world trade increased to 7.7%, and remained the third in the world. Trade development not only puts forward urgent demand for RMB internationalization, but also becomes an important realistic force to promote RMB internationalization. The financial crisis will inevitably have a negative impact on China's foreign trade. But as far as the trade structure is concerned, China's exports are mainly concentrated in labor-intensive products and low-priced products, and the income elasticity is relatively small. In the case of economic depression and declining income of residents, the demand for these commodities in various countries may rise instead of falling. At the same time, China has taken a series of measures, such as increasing the export tax rebate rate of some industries and improving the foreign trade environment, to partially alleviate the impact of changes in the international economic situation on China's import and export. Therefore, under the financial crisis, China's foreign trade is facing severe challenges, but there are also many favorable factors. In addition, the crisis has forced China to upgrade its trade structure, improve its product competitiveness and technological content, and will also enhance its trade payment options and currency influence, which is conducive to the internationalization of RMB.