Many different views regarding the internalization of the RMB were presented at the summit. Some of the business executives said the Chinese economy rapid development will force the RMB to become a global currency, regardless if it is regulated or not by the government. Indeed, there has already been significant strides in Hong Kong becoming the first RMB international hub.
According to statistics from China Treasury Bureau and Financial Services, by the end of October 2011, Hong Kong almost doubled its RMB deposits from the start of 2011, which now accounts for approximately 10 percent of Hong Kong total deposits. But some scholars at the summit noted that many external factors are preventing the Hong Kong from completely embracing the RMB. Re Ping, the vice president of the China Banking Association pointed out that Hong Kong investors are still wary about the strength and reliability of the RMB, and are also investing in it with caution.
Many financial analysts at the Shenzhen-Hong Kong ASEAN Summit said that the Chinese government plan to transform Hong Kong into its first offshore RMB hub is just one of its steps to internationalizing the RMB making it into a world reserve currency. One important scholar from Peking University pointed out that many businesses and foreign governments are waiting for Hong Kong to begin issuing RMB dominated bonds to foreign investors and governments.
However, the internalization of the RMB would benefit Chinese businesses as well as international businesses, Shen Guobing, a renowned professor of the world economy and international finance at Fudan University in Shanghai, told Asia Outbound. The internationalization of the RMB) will offer our Chinese companies more opportunities of foreign trade and outward direct investment use RFDI (RMB FDI) to invest in China, avoiding exchange rate risks, he said.
Many international businesses, such as private equity corporations, institutional investors, and banks have also found that the internationalization of the RBM as positive news. Standard Charters PLC, an international bank, has found the RMB flows between China and Hong Kong beneficial. But the government is still cautious in rushing the RMB to internationalize in fear that it may fall out of the government control.
John Williamson, a senior researcher at Peterson Institute for International Economics, told Asia Outbound it is likely that China plan to make Hong Kong into a offshore RMB center will be successful. he chances are that making HK a financial hub for the RMB would either fail (which I would doubt) or else it would require that the Chinese government accept a significant curtailment in its ability to micromanage the RMB. /p>
Xinhua magazine, and Caijing both said that the views and ideas presented at the Shenzhen-HK-Financial Industry Summit 2011 will probably be used by the Chinese government to make future decisions regarding the internationalizing of the RMB.
