On 1 December 2022, the Faculty of Finance of the City University of Macau held the Finance Seminar Series [12] at the Ho Yin Convention Centre. Dean Li Xiao from Guangzhou College of Commerce, was invited to deliver a speech titled “Rethinking the Internationalization of RMB: The Way of the Rise of Big Currency in the View of Monetary History”. Guests attending this seminar include Dean Adrian Cheung, and Associate Dean Eva Khong of Faculty of Finance, City University of Macau.

Dean Li is also a “Kuang Yaming Scholar” Excellent Teacher, Director of Hengqin Intelligent Finance Research Institute, “the Changjiang (Yangtze River) Scholar” Distinguished Professor of the Ministry of Education, the Discipline Evaluation Group of the State Council Academic Degrees Committee, Member of the Economics Teaching Advisory Committee of the Ministry of Education, Supervisor of China Society of World Economics, Deputy Secretary General of China Society for Finance and Banking, and Executive Director and Member of the Academic Committee of China International Finance Society.

To begin with, Dean Li explained the current situation of RMB internationalization. The beginning of RMB internationalization is the result of the global financial crisis in 2008 and the stagnation of monetary and financial cooperation in East Asia. Since the implementation of cross-border RMB settlement in 2009 to 2015, the internationalization of RMB has experienced a period of rapid development promoted by the government. It has been in a low ebb since 2016, and gradually entered a stage of steady development in 2018. From the second half of 2020 to the end of 2021, the research on RMB internationalization in domestic economic circles has entered a new stage. In 2022, with the escalation of the power politics between China and the United States, especially the outbreak of the Ukraine conflict, the comprehensive sanctions taken by developed countries led by the United States against Russia and Russia's countermeasures and other geopolitical conflicts, the internationalization of RMB begins to face severe choices. After more than a decade of rapid development, RMB internationalization has made certain achievements. At present, the scale of international use and market recognition of RMB continue to grow, RMB has become the world's fifth international reserve currency and the fifth largest international payment currency, and has formed a unique offshore RMB market covering Hong Kong, Singapore and London.

The short-term goal of RMB internationalization is to reduce the costs and risks of China's economic growth, social development and external relations in the US dollar system. The long-term goal is to support sustainable economic growth and the sustainable rise of the country. The internationalization of RMB is the result of China's sustained economic growth, high financial development and opening-up, including the development and change of the pattern of dual surpluses in the balance of payments; Under the US dollar system, with the private capital flows becoming the main body of the global capital market, the connotation of liquidity has expanded. The construction of the new pattern of "dual circulation" requires a higher level of opening and development of the financial industry, and the benchmarking and integration with developed financial markets in terms of rules and systems.

Lastly, Dean Li concluded that the process of RMB internationalization should play an international currency function in line with China's economic strength and status in the US dollar system, and its core issue is to avoid the "trap of geopolitical conflict" externally and promote the institutional construction and development of the domestic financial market internally. One of the important roots of the rise of modern world powers lies in the "financial revolution", the result of which is to seek sustainable rise through the development of the financial market by using other people's funds. Therefore, it is necessary to pay attention to the coordination of RMB through other major currencies, including market rules, institutions and politics. In addition, the "Belt and Road" initiative has been adopted to promote the internationalization of the RMB. Its core is the regional division of labor and cooperation in market function and political coordination.

With his rich experience and incisive views, Dean Li explored the internationalization of RMB from the perspective of the rise of major currencies in the history of currency, which made students pay more attention to the development process and future prospects of RMB internationalization. Through the financial seminar series, the students have gained knowledge in understanding the relationship between the Chinese economy and the internationalization of RMB. They look forward to participating in more financial seminars in the future, combining the practice and learning of the financial discipline.