Analysis Of China’s Opening Capital Account Promoting The RMB Internationalization

In order to promote the RMB’s internationalization, China made a great effort in settling the facilitating cross-border RMB and enhancing the offshore RMB’s transactions, establishing the RMB’s Hong Kong offshore financial center and the Shanghai-Hong Kong Stock Connect, improving the construction of the financial market and improving the cooperation with other countries or regions, and got a tremendous progress. In November, 2015, The International Monetary Fund(IMF)announced that the RMB was officially included in the SDR(IMF Special Drawing Rights) currencies basket, which marks the RMB internationalization into a new development stage. It is a remarkable progress compared with the beginning of reform that the RMB internationalization was virtually zero. It also means that as the rising international status of China, RMB could achieve a higher international status in the future development.In the common influences of the RMB offshore market and RMB cross-border settlement, to promote a further open of the capital account became the important choice to promote the internationalization of the RMB, so, expanding the opening capital account came into being. But it is noticed that opening capital account is not all open,because, a great number of RMB flows would have a significant impact on the domestic economy or the global economy, this effect might create tremendous value, but the potential risks also can’t be ignored. China must gradually and orderly open the capital account, only in this way it can help to optimize our internal resources allocation,promote the objectives of the foreign exchange system reform, and adapt global requirements of cooperation and competition. Only in this way can steady help the opening capital account to promote the RMB internationalization further development.So, this article mainly uses analysis methods of qualitative and empirical to analysis the China’s opening capital account promoting the RMB internationalization. Here using Eviews software made a co-integration regression analysis on capital account liberalization and other main factors that influencing the internationalization of RMB,and focuses on analysis the opening capital account’s test results, in order to provide quantifiable arguments for the opening capital account which promoting the extent of RMB internationalization. Then, make policy recommendations for the opening capital account and the RMB internationalization. This paper mainly proposes four proposedmeasures: orderly open capital account, deepen reform financial, improve financial markets, build and improve risk warning mechanism, we hope that the four proposed measures can effectively and steady help the opening capital account to promote the RMB internationalization further development.