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HomeNewsBelt and Road Boosts RMB Internationalization

Belt and Road Boosts RMB Internationalization

2019-05-22

THE Belt and Road Initiative was written into the Constitution of the Communist Party of China (CPC) at the 19th CPC National Congress, signaling China`s resolution and confidence in carrying out international cooperation under this initiative.

From a long-term, global perspective, China and the countries along the routes have obtained a slew of benefits in infrastructure construction and production capacity cooperation, laying a concrete foundation for further cooperation. However, financial risks remain a hindrance to transnational synergy. To facilitate the use of China`s RMB in countries involved in the Belt and Road Initiative will help Chinese investors get around bottlenecks in exchange rates, financing, and debts, and furthermore promote the currency`s status in the international monetary system.

Financial Risks

The Belt and Road Initiative, a key measure for Chinese companies` [going global" strategy, serves as an important platform for the RMB`s internationalization. In their operations overseas, Chinese companies need to handle a large amount of financial business such as exchange, guarantee, debit and credit, and insurance. In less developed countries along the routes, however, one of the perplexing issues for these companies is financial risks brought about by fluctuations in policies.