EFSAS ARTICLE - Challenges of RMB Internationalization - Insights from the NDB and the AIIB

5 | June 2023 Challenges of RMB Internationalization Insights from the NDB and the AIIB Challenges of RMB Internationalization 2 Challenges of RMB Internationalization: Insights from the NDB and the AIIB Introduction On the back of its growing economic success in the 21st century, China has begun pushing for the growing international usage of the national currency, the Renminbi (RMB), in cross-bor. [...] MDBs in the internationalization of the RMB Pushing for the growing internationalization of the RMB has become a key economic policy objective for China in the 21st century. [...] The MoU also included provisions for promoting the use of the RMB in cross-border transactions between the NDB and the CDB. [...] Yet, the structural dominance of other currencies, most notably the dollar, the dollar’s network effects in the global economy, and concerns regarding exchange rate risk and political stability will likely limit the degree to which other countries buy into the internationalization of the RMB in the immediate future. [...] Conclusion China's push for the internationalization of the RMB has been a key economic policy objective in the 21st century that the NDB and AIIB have played a crucial role in, primarily due to the development of financial instruments and the link between the RMB and the BRI.