Digital renminbi accelerates internationalization

In its 2021-25 industrial development plan the Luohu district government of Shenzhen published on Tuesday, it vows to promote mobile payments and internationalization of digital renminbi.

It should not be forgotten that it was in Luohu that the digital renminbi was piloted on a large scale for the first time in October last year.

Notably, the governments of Beijing, Shanghai and Guangdong province also include piloting wider application of digital renminbi in their work reports and five-year development plans.

Which raises people’s expectations that the digital renminbi is on its way. The internationalization of the renminbi and the growing popularity of mobile payments have paved the way for the digital currency. And the popularization of mobile payment terminals and the advancement of information technology have also laid the necessary foundation for a wide range of applications of the digital renminbi.

Particularly, the COVID-19 pandemic has increased people’s acceptance of the digital economy and non-contact e-payments.

As an important infrastructure of finance in the digital era, digital currencies will be a key arena for the competition of the future monetary market. By promoting the use of the digital renminbi, and accelerating the internationalization of its digital currency, China can improve the efficiency of its payment system and financial system, which is conducive to safeguarding its economic and financial security, as well as improving its financial supervision, governance of the digital economy and international cooperation in finance.

If the digital renminbi can gain a larger stage in the world, it will demonstrate its potential to break the monopoly of the US dollar in the international monetary system.

The issuance and circulation of digital currencies, especially central bank legal digital currencies, will profoundly change the existing international monetary system, clearing and settlement system, and financial system.

Only through actively participating in the innovation, supervision, management and cooperation of the emerging sector can China gain the initiative to secure a right to have a say in the making of the relevant rules and international standards for digital currencies.

The internationalization of the digital renminbi should match China’s status as the world’s secondlargest economy and largest goods trader.