Author: Chen, Mo
Title: The impact of offshore RMB market on RMB internationalization and Hong Kong’s role
Degree: D.B.A.
Year: 2021
Subject: Renminbi
Foreign exchange -- China
International finance
Capital market -- China
Hong Kong Polytechnic University -- Dissertations
Department: Faculty of Business
Pages: 74 pages : color illustrations
Language: English
Abstract: The offshore RMB market (ORM) is an innovative international financial market in China. Considerable progress has been achieved since the establishment of the offshore RMB center, and financial innovative products are constantly enriched, effectively promoting RMB internationalization development in China. Whether and how the ORM construction affects the internationalization of RMB in China has some theoretical support, and the experiences of many developed countries verify this problem. Therefore, in this study, the effects of ORM on the internationalization of RMB are analyzed from the literature and a theoretical point of view. Then, the development experiences of America and Japan are elaborated and tested empirically, and the profound effects of the offshore financial markets of these two countries on the internationalization of their currency are demonstrated. Finally, empirical analysis is used to demonstrate that the offshore RMB index (ORI) and economic scale are positively correlated with the RMB internationalization index (RII), while the real interest rate and inflation rate are negatively correlated with the RII.
The main aspects of this paper include the following: In the first chapter, the introduction takes the research background as the starting point and focuses on the significance of the study. Then, it briefly introduces the main research contents and the analysis methods used in this paper. The second chapter contains the literature review and provides an analysis of the available literature on currency internationalization and offshore financial markets construct, including RMB internationalization and ORM on the effect of RMB internationalization, and proposes several possible innovations of this paper. The third chapter expounds on the relationship between currency globalization and offshore financial market development in developed countries, taking America and Japan as examples, and conducts theoretical and empirical analyses. The fourth chapter analyses the history of the development and current situation of ORM and RMB internationalization in Hong Kong. The fifth chapter begins with the RMB internationalization and offshore RMB indices and conducts a detailed analysis of the factors affecting RMB internationalization. Then, an econometric model is established to analyze the empirical results of the effects of the ORM on RMB internationalization. The sixth chapter proposes suggestions on how to improve the construction of ORM based on the establishment of the free trade area, the strategy of "One Belt, One Road", and the new background of RMB joining the SDR and provides two suggestions on how to strengthen the financial service function of ORM and improve the degree of risk control of the offshore market.
Rights: All rights reserved
Access: restricted access

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