The Internationalisation of the Renminbi: Prospects and Risks

By looking at how far China has gone in internationalising its currency, the Renminbi (RMB), it is possible to identify the main strategic goals that China wants to achieve through this process, along with the main risks that such an objective embodies.

It can be said that so far the gradual internationalisation process of the Chinese Renminbi (RMB) has been successful. The Chinese approach of crossing the river by feeling for the stones underwater has proved to be adequate. While it is commonly believed that a currency can only become international when it is fully convertible, Hong Kong and the RMB might prove the contrary. Nonetheless, there are several risks lying ahead. So far the internationalisation process has developed smoothly because the waters of the river have been relatively shallow, but once they deepen proportionally to the amount of RMBs that are in circulation overseas, the journey might not be so easy.