Research On The Cross-border RMB Of Yunnan Province

In 2008, the U.S. sub-prime mortgage crisis opened the Pandora’s Box of financial crisis worldwide, so the current world economic pattern is experiencing a profound adjustment. All the international trade parities have higher risk expectation to the turbulence exchange rate of US dollar, Euro and other main international currencies; therefore they must take effective ways to reduce their dependency on US dollar and the impact on their profit that brought about exchange rate risk. By contrast, with ever increasing economic power and the strong performance of RMB during the financial crisis, RMB internationalization became a very hot topic worldwide. So far, RMB have played an important role as the currency of account and the currency of reserve in nearby countries and surroundings, even have potential to be an international settlement currency. In July 2009, Cross-border RMB was born in this background.Yunnan Province borders neighboring countries in Southeast Asia, which is the only bridgehead that opening to both Southeast Asia and South Asia countries. And Yunnan Province is the intersection of many region economic cooperation organizations such as, China-ASEAN Free Trade Area, GMS and BCIM. Yunnan Province is playing one of the most significant roles in the strategy of western opening and development, so the progress of cross border RMB business in Yunnan Province is a vital measure to push the development of western China and RMB internationalization.This paper was started from the theory of international trade currency, optimum currency areas, and then analyzed relevant researches on RMB internationalization and cross border RMB business, providing theoretical support for my research on cross border RMB business of Yunnan Province. Then, this paper did further analysis on the RMB internationalization and the development process of cross border RMB national wide. Further to describe the existing situation, the special settlement mode, and the difficulty and problems of cross border RMB business development in Yunnan Province from multi-point of view. At last, finding the development path and policy dilemma based on the analysis above of Yunnan Province statue to make some contributions on the development of cross border RMB business.