A Study On Circumfluence Channel Of Oversea Renminbi

Since the2008Global Financial Crisis, China has improved the international status significantly, which would inevitably increased the influence of RMB on the world. The internationalization of RMB is one of the Chinese key objectives in recent years. A country’s currency want to become an international currency, he have two steps. First, the currency should flow into the world through trade demand, investment demand and prevent demand, then returned to the territory through formal channels. Thus the country has formed a two-way international circulation of money. In promoting the internationalization of the renminbi, if lack of the two-way flow of RMB imbalance mechanism, will inevitably affect the attractiveness of RMB in the international area. Improve the RMB flow back mechanism is the key point of improving the structure imbalances of the current RMB cross-border flow.First, this paper analyses the current RMB’s major outflow and return channels, also its problems, and then analyzes the necessity of the establishment and improvement of RMB’s flow back channel. Next, the paper discusses the conditions of establishing the flow back channel. Finally, in consideration of the establishment of Shanghai Free Trade Zone, the paper give a comprehensive analysis of the currency’s present situation. Conclude that establish offshore financial center in Shanghai is a breakthrough to improve back mechanism of renminbi.