Research On RMB Cross Border Circulation In Sino-N. Korea Borderline Area (Yanbian)

Ever since the 1990's (the decades of the 20th Century),owing to the continuous and steady growth of our country's economy and Comprehensive National Power, and owing to the stability of the RMB, RMB is accepted by more and more neighboring countries in the foreign economic activities and in the border trade business.In the countries that neighbors Yanbian Prefecture, especially in North Korea, there had been RMB circulation through the grass root channel near Sino-N.Korea borderline area as early as the beginning of 1990's (the 20th century), and the amount of RMB in circulation had amounted to a certain scale. Through the population flow and trade activities, enormous amount of RMB has been accumulated in North Korea, and in the meantime, the scale of RMB's cross border circulation is seen increasing.As the abscense of the official route for currency exchange, transactions in RMB settlement and cross border circulation between two countries carried out are basically non-governmental activities.In order to further strengthen Sino-N. Korea cooperation in RMB settlement, to solve the problems arising from RMB settlement, in the beginning of the 1990's, two country's central banks concluded "Payment & Settlement Treaty Between the People's Bank of China and the Central Bank of DPRK", and which was given further supplementation and amendment in 2004.In 1998, Hunchun City Branch of China Construction Bank and the Gumsamgak Bank of North Korea established a cooperation relationship in RMB settlement. In order to fulfill the needs of the banking business development, both parties rewrote the agreement in RMB Settlement Cooperation in the sector of border trade business and executed the agreement in Dec 2007,which further reinforced the relationship between Hunchun City Branch and Gumsamgak Bank of North Korea in RMB Settlement Cooperation. In 2008, Hunchun Branch entered a RMB Cash Transfer Cooperation Agreement with N.Korea counterparty, which has brought convenience for RMB Cross Border Circulation.Presently, the RMB currency's active circulation in the surrounding countries and the regions has made the issue to globalize RMB receiving wider attention.The Sign of RMB Cross Border Circulation is an indication that RMB is in the course of globalization.The course of acceleration of RMB cross border circulation aiming to make RMB widely accepted as the currency for pricing, settlement and reservation, is the course of RMB Globalization.As a rising big power, China, in the globalized economy, has integrated itself into the world economy, reasoning that the globalization of RMB is the necessary trend.To carefully analyze over the cause of RMB cross border circulation and the effect brought forth, to make a scientific judgement on RMB's position on the Stage of RMB Globalization, to ascertain the advantages and prohibitive factors in the RMB Cross Border Circulation so as to take more effective approaches, shall bear vital, practical significance in pushing the progress of globalization of RMB.In accordance with the practical situation in the Sino-N. Korea border area of Yanbian Prefecture, through investigations on the RMB amount of flow out of and into China, and investigations on the amount of RMB accumulation in the surrounding countries, the study makes analysis over the influence brought from RMB cross border circulation to the border regional economy, sheds light on the existing problems in RMB Cross Border Circulation. In addition, the study, basing on the summary and assimilation of results of relative researches our country and foreign country, gives a systematic analysis and research on the problems in the RMB cross border circulation in six parts through the combination of theoretical analysis and real proof analysis.Through the analysis over the existing major problems and tough issues in RMB cross border circulation in the region of Sino-N. Korea border area, the study comes up with advisable suggestions that will promote the facilitation of Sino-N.Korea trade business in different levels and stages, and suggestions that will facilitate the RMB Globalization.