On Estimation In Scale And Reasons Of RMB In Circulation Abroad

With the deepening of economic reform and the advance of opening-up policy,the economy in China is increasingly growing, and RMB has been more widelyaccepted abroad, especially in border trade such as Hong Kong, Macao and Taiwanregions and neighboring countries. The scale of RMB circulation abroad is increasing,which means that the internationalization of the RMB begins to enter into an initialstage. Therefore, the scale estimate and cause research of RMB in circulation abroad,and proposing relevant measures are of great significance for the promotion of theprocess of internationalization of RMB.This paper， with reference to domestic and foreign research about the scaleestimate method and theory research， analyzes the current situation of RMB incirculation abroad and estimates the scale of2006-2012RMB in circulation abroad bythe indirect method. Then, we analyze the reasons of RMB in circulation abroad.The results of RMB abroad scale divide into three phases:(1) From2006to2008,the scale has shown a steady upward trend, peaking in2008;(2) There was a decliningtrend from2009to the second quarter of2010, reaching the lowest point in2009;(3)After the second quarter of2010, the amount accelerated to soar beyond the2008peak; while, the reasons for the RMB overseas flow are total trade, currency stability,and economic growth.Finally we make policy recommendations to promote the RMB circulationabroad, including macro measures and micro measures. Macro measures include:(1)promoting the RMB participation in international settlement;(2) improving theeconomic strength, and keeping the RMB exchange rate steadily;(3) accelerating tomake RMB freely convertible;(4) accelerating the construction of RMB offshorefinancial centers in Hong Kong;(5) Improve monitoring system of RMB in circulationabroad. Micro policies include strengthening the bilateral cooperation between banksand improving the financial service, and promoting innovation of settlement products.