Opportunities And Challenges Of Internationalization Of RMB Within The Framework Of Shanghai Free Trade Zone

RMB internationalization means that RMB plays the role of internationalcurrency in the fields of international trade and investment and finally becomes theworld’s reserve currency. The global financial crisis in2008provides a historicalopportunity for the launch of RMB internationalization. Since China is not fullyprepared for RMB internationalization, it faces severe challenges. Shanghai PilotFree Trade Zone established in2013provides new momentum for RMBinternationalization through financial innovation and liberalization.This dissertation elaborates the basic theories of currency internationalizationand the current conditions of Shanghai Pilot Free Trade Zone and RMBinternationalization, and discusses how market-oriented interest rate and exchangerate, RMB capital account convertibility and CNH market promote RMBinternationalization. As for challenges, this dissertation analyzes the potential risks inthe process of financial liberalization, different patterns in promoting RMBnationalization and external constraints. Last, this dissertation comes up with certainconclusions and suggestions including readjusting economic structures, promotingCNH market and RMB capital account convertibility in order.