Yuan internationalization to be accomplished in decade   

報告稱人民幣國際化10年后水到渠成 形成三元制衡

中國人民大學今日在京首次發布《人民幣國際化報告》。報告認為，人民幣國際化將在10年后水到渠成，目前最大挑戰來自中國實體經濟。

Beijing (CNS) -- The grand mission of yuan internationalization is expected to be accomplished in ten years, with the biggest challenge being China's real economy, pointed out a report released by the International Monetary Institute of Renmin University on Saturday.

The report created an "internationalization index" reflecting the performance of the yuan currency in cross-border trade settlements, international bond issuance, and other countries' foreign exchange reserves. The yuan index rocketed from 0.02 to 0.45 in one year from 2010, while the U.S. dollar figure remained high at around 54.18.

In a decade from 2030, it is predicted the yuan index will grow beyond 20 and a new triangular currency system will be established with three dominant currencies – the U.S. dollar, the euro and the RMB.

However, the lack of an independent economic mode will seriously hamper the process if managed improperly, warned the report, referring to China's current heavy reliance on foreign demand and low-end industries to fuel its economy. These conditions hinder its influence on international trade and the discourse on global negotiations regarding currency settlements.

Fragile and inefficient domestic financial markets have greatly lowered the performance and the attractiveness of the RMB in the global market, and the problem will gradually become more obvious.

Moreover, an essential offshore yuan market should be established to support the internationalization of RMB.

China must be cautious in opening yuan capital accounts, reminded Chen Yulu, the editor-in-chief of the report, president of the university, and academic adviser to the People's Bank of China, for, "If no strict controls are imposed on speculative hot money, monetary and fiscal policies won't be effective and the safety of the nation's financial markets and the real economy could be seriously jeopardized."