The Core Currency Status Of RMB In The East Asian Monetary Cooperation

The regional economic cooperation under globalization background develops rapidly, the birth of Euro and the fast pullulating of Dollar area have verified correctness of regional economies' theory. The economic and trade relationship of East Asia has been expanded by leaps and bounds, but area currency cooperation develops slowly. It becomes a necessary choice to reinforce area currency cooperating and resist outer impingement commonly under the condition that financial globalization and financial crisis happens frequently.The East Asia financial crisis started the currency cooperation. The ultimate target is to build a single area during a long time. But it becomes very difficult because East Asia could not reach the OCA guidelines at present. Therefore, realization of East Asia currency area should be two phases: in the first place, build hypo-area currency area, and then transit to single currency area. Judging from the economic developing trend of the area and the relevant index to build hypo-area currency area, China (including Hong Kong, Taiwan) and the East Asia have the possibility and feasibility. It is the just under this background that the paper studies the RMB status in the East Asia monetary cooperation.This study differs from a general study of pure theories; it has a strong realistic meaning. So some analysis measures, such as combination of theories research and positive analysis, combination of quantitative analysis and qualitative analysis, combination of antitheses and induction, etc. are adopted in the paper. In this paper, theories research is mainly used in the introduction of East Asian monetary cooperation and optimal currency area, and positive analysis is used in the income analysis that RMB becomes the core money in the East Asian monetary cooperation. In the chapter of obstacles factors for RMB to realize the core status, induction and comparison methods are adopted to analyze the competition of US dollars, EURO and Japanese Yen with RMB in the hypo-East Asian monetary cooperation. Based on the realistic situation of China, the paper finally concludes some proper ways to achieve the goals.The paper has five parts:The first part is introductory remarks, which mainly introduces the background, significance and the method of the research that Renminbi becomes the core currency in the East Asian currency cooperation.The second part carries on the summary to the domestic and foreign related literature. The thesis with the beginning of OCA theories analyzes the way to build unite currency region from hypo-East Asian monetary cooperation and then it proposes the question how the Renminbi could become the core currency in this process.The third part discusses necessity and the feasibility that Renminbi becomes the core in the East Asian currency cooperation.The weak status of Renminbi in the international competition of currency has done enormous harm to Chinese domestic economy, so China should take active part into the competition.But the continually growing and openning Chinese economy provides conditions for RMB to become the core currency of East Asia.China plays automatic stabilization role day by day in the East Asian economy development, Renminbi has more and more high international acceptability in the region.Therefore, the conclusion of this part believes that China has ability to control Renminbi regionalizing and does well in the macro-economical regulations of East Asian monetary area.The fourth part analyzes some factors that could restrict Renminbi from the core currency in the East Asian currency cooperation such as unconvertibility of capital item, spontaneous circulation beyond the border of Renminbi and the competition of US dollar and Japanese Yen in a quite long time.In the fifth part some suitable strategic choices are claimed.