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In recent years, significant progress has been made in the internationalization of the Renminbi, and its proportion in the international monetary system has also increased. Since the Chinese yuan officially joined the Special Drawing Rights (SDR) in 2016, its weight in the SDR has increased from an initial 10.92% to 12.28%. This change reflects the wider use of the RMB in international trade, foreign exchange reserves, global foreign exchange transactions, and investment and financing, and the acceleration of the internationalization process of the RMB. At present, the international political and economic situation has undergone significant changes, and the global industrial and supply chains are accelerating their restructuring, which will have a profound impact on the internationalization of the renminbi. For example, some economies are unable to obtain channels for payment and investment using international currencies due to various reasons, resulting in a significant increase in the proportion of RMB usage.
The proportion of China using RMB for cross-border settlement of goods trade has exceeded 30%. In the countries jointly building the "the Belt and Road", the pricing and settlement in RMB has also maintained an increase of more than 10%, more than 20% and even more than 30%.
When discussing the classification of countries that mainly support RMB settlement, we can conduct a detailed analysis from the following aspects:
1、 Surrounding countries and regions
List countries: North Korea, Mongolia, Pakistan, Vietnam, Laos, Myanmar, Nepal, etc.
• Geographic proximity: These countries are geographically adjacent to China, facilitating economic and trade exchanges as well as currency circulation.
Frequent economic and trade exchanges: Long term trade cooperation has prompted these countries to start using RMB for settlement earlier to meet the needs of trade facilitation.
2、 Gulf countries
List countries: Iran, Saudi Arabia, etc.
• Close commodity trade: These countries mainly export commodities such as oil and have deep trade ties with China.
• Currency shift for settlement: With China's increasing position in the global energy market, Gulf countries are gradually accepting the Chinese yuan as their settlement currency to reduce their dependence on the US dollar.
3、 Important trading partners
List countries: Russia, Germany, United Kingdom, etc.
Trade demand and economic considerations: These countries have a large amount of trade with China, and using RMB settlement can reduce costs and improve efficiency.
Specific cooperation cases: Taking China Russia trade as an example, the two countries have extensive cooperation in energy, infrastructure and other fields, and the use of RMB settlement has become the norm. This not only promotes the convenience of bilateral trade, but also enhances the complementarity and stability of the economies of both sides.
• Accelerated internationalization process: The support of important trading partners has further accelerated the internationalization process of the RMB, enhancing its position in global trade and investment.
4、 Emerging markets and developing countries
List countries: Argentina, Brazil, etc.
External factors: Affected by external factors such as the US dollar interest rate hike, these countries are facing pressure from exchange rate fluctuations and rising financing costs, therefore seeking diversified currency settlement methods to diversify risks.
The Renminbi has become an option for these countries due to its stability and lower financing costs. Adopting RMB settlement will contribute to its economic stability and promote economic cooperation with China.
Economic stability and cooperation: The adoption of RMB settlement by emerging market countries not only contributes to their domestic economic stability, but also strengthens cooperation with China in trade, investment, and other fields, providing strong support for the common development of the two economies.