A Study On RMB Settlement Of Cross Border Trade

Since the financial crisis in 2007, the U.S. Dollar has been attacked as the international monetary system.Many countries began to realize the risks of U.S. Dollar, look for new ways to reform the current monetary system and improve other international currencies. In recent years, with the continuous expansion and the improvement of China’s economic, the pace of internationalization of the RMB gradually accelerated. As the first step in the internationalization of the RMB, the cross-border trade in RMB expands the scale of development, but in the development process there are many problems, so this paper will make a systematic research in this topic.At present, RMB has not become an international settlement currency, and the internalization of RMB is a long process. In order to promote the development of RMB cross-border trade, in April 2009 our Government has decided in Shanghai, Guangzhou, Shenzhen, Zhuhai, Dongguan to carry out cross-border trade RMB settlement pilot. After two expanded in June 2010 and August 2011, cross-border trade settlement expanded from the territory of area to the whole country. At the end of 2014, the RMB settlement of cross-border trade of foreign countries amounted to 189. Promoting the RMB settlement of cross-border trade have a vital role in the national economy, it will help reduce our country economy serious negative effect to create a good space environment for China’s economic development.Firstly, I will start from the international monetary theory explained by currency substitution theory, international trade settlement currency choice theory in order to grasp the knowledge of cross-border trade settlement from the macro. Secondly, using the method of combination of theory and practice, analysis of the RAM in crossborder trade in the development of history, explore the current situation of China’s cross-border RMB trade settlement. Again, by constructing a vector autoregressive model(VAR) analysis on main domestic economic variables(RMB real effective exchange rate, trade import and export volume) on the RMB settlement of crossborder trade, the analysis shows that the total import and export volume of trade and the real effective exchange rate of RMB were positively related to the RMB settlement of cross-border trade in the short term Granger reasons. Finally, based on the analysis of the results of the further expansion of the scale of the RAM crossborder trade in the aspects of optimizing the trade structure, reforming the financial market and perfecting the payment to better promote the process of internationalization of the RMB.