Research On RMB Settlement Of Cross-border Trade

In2010, the total amount of China’s GDP exceeded Japan and became thesecond largest economy in the world. With the promotion of economic strength, Chinaenjoys the recognition of role at international politics and economy, and theinternationalization of RMB gets a more and more solid realistic base. As the first stepof RMB internationalization, RMB settlement of cross-border trade is the importantreflection of the important role of our country’s economy in the world. This step isrelation to the process of RMB internationalization whether can be completedsmoothly, and become an international currency. Therefore, strengthen its research hasimportant practical significance.The paper focuses on the following problem: First, Why do you want to advanceinto RMB trade settlement? Second, what is the theoretical basis of the RMB as thesettlement currency? Third, what is the influence of RMB settlement of cross-bordertrade to our country’s foreign economy? Research conclusion is: First, promotingRMB settlement of cross-border trade is the inevitable result of economicdevelopment, is the inevitable choice of the further development of open economy.Second, the RMB settlement of cross-border trade is a comprehensive process, subjectto domestic and foreign various aspects factor restriction, the RMB as an internationalcurrency will be a long-term and complicated process. Third, RMB settlement ofcross-border trade has a promoting effect on the increase of foreign trade andinvestment. The paper uses the theory of international trade settlement currencychoice model to analyze the theory basis of RMB as the settlement currency and VECmodel to analyze the impacts of RMB settlement of cross-border trade on ourcountry’s foreign trade and investment.To better promote the development of RMB settlement of cross-border trade andour country’s foreign trade and investment, the paper suggests that we should fostercomparative export enterprises, enhance the application of RMB in export trade,broaden foreign investment areas, innovate foreign investment pattern, orderlyadvance the liberalization of financial loan, clear RMB two-way flow channel, furtherdevelop offshore financial market, optimize financial market system, steady promotethe interest rate marketization to promote the development of RMB settlement ofcross-border trade.