The Processes Of Internationalization Of The World's Major Currencies: Comparison And Reference

The serious financial crisis of U.S. beginning in 2007 brought heavy losses to the development of the world real and the virtual economy. In order to restore the national economy, the United States took a dollar-sinking policy to stimulate exports and increase employment, which caused the value of the world dollar reserves shrunk, the U.S. dollar as a international currency credit was widely questioned and the voices of reforming the international monetary system began to louder. Along with the sustained, rapid and healthy development of China's economy, the internationalization of RMB is undoubtedly the key driver of reforming the currency system. Against this major background, domestic and overseas scholars, experts are getting more enthusiastic to study the issue of RMB internationalization. Different standpoints are held on the questions such as whether the RMB should be an important member in the international monetary system, how the RMB get internationalizing, what measures should be taken and how to promote the strategic steps.In this paper, the RMB Internationalization is described in detail based on the theoretical foundation. In Chapter IV we give a qualitative comparison and a measurement analysis on some key indicators of Germany and Japan which were in their currencies internationalized periods and those of China at present. We think that the conditions of RMB internationalization are ripe, in which Chinese government should promote the RMB internationalization actively. We can absorb some experiences from Germany and Japan instead of America in the process of RMB internationalization as the internationalization of us dollar is inadvisable and difficult to realize. At present, RMB is only got a foot in the door, and it is a long and complex process for RMB to realize internationalization.Some key conditions must be held to an international currency i.e. internal and external currency stability, complete exchange rate system, comprehensive national strength,larger import and export proportions in the world.The possible innovation of this paper is that, according to the basic conditions an international currency must have, we give an systematic comparison on some key indicators (such as exchange rates, inflation rates, GDP proportion, total import and export value shares in the world and the exchange rate level, etc.) of Germany from 1970 to 1989 and Japan from 1970 to 1989, which were in their currencies internationalized periods and those of China from 1989 to 2008, and find that the present conditions are similar to that of Deutsche Mark and Japanese yen internationalizing situations. Therefore, we draw a conclusion that the RMB internationalizing conditions are ripe. Chinese government should absorb some Deutsche Mark and Japanese yen internationalizing experiences, and actively promote RMB internationalization.There are six chapters in this thesis. ChapterⅠis an introduction part which shows the urgency and necessity of RMB internationalization. In the second chapter, we explain the connotations of international monetary and currency internationalization, describe the theories of the currency substitution and optimal currency area, summarize several conditions which must be considered in the process of currency internationalizing and analyze the positive effects and negative impacts that an internationalized currency brings to that currency issue country. In chapterⅢ, by comparing the internationalized historical evolutions and the development modes of US dollar, Deutsche Mark and Japanese yen, we find that the experiences of Deutsche Mark and Japanese yen internalizations are more suitable as guidance for developing countries than that of US dollar. In ChapterⅣ, by using a combination method of qualitative and quantitative analysis, we make a comprehensive comparison of some key factors of Germany and Japan during their currency internationalizing periods and that of China at present, discover that China is under a similar situations with Germany and Japan in their currencies internationalized periods and reach the conclusion that RMB internationalizing conditions are ripe.In ChapterⅤ, we give a comprehensive analysis of the present situation of RMB internationalization, consider the degree and the stage of RMB internationalization and make an in-depth analysis of some main constraint factors of the RMB internationalization by combining with the economic and financial reforming process of China. In ChapterⅥ, we propose some measures on RMB internationalization from both macro and micro perspectives.