Lu Ting: Shanghai, Hong Kong And Hong Kong Further Accelerate The Internationalization Of RMB

< p > Shanghai and Hong Kong is no doubt considered to be another important step for China to accelerate the process of internationalization of "a href=" http://www.91se91.com/news/index_c.asp "RMB" /a ", which is conducive to promoting internationalization of RMB and supporting Hongkong to become an offshore RMB business center.

It is true that Shanghai and Hong Kong have built a new bridge for two-way flow of capital between Hongkong and the mainland, which not only increases investment channels for offshore renminbi, but also improves the liquidity of offshore renminbi in Hongkong, which helps to expand the use of RMB and the construction of offshore markets.

However, the author believes that in addition, Shanghai and Hong Kong's more profound significance to the internationalization of RMB is that it will promote the improvement of the mainland's capital market and provide support for the RMB's long-term competitiveness as an international currency.

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< p > at present, Shanghai and Hong Kong pass includes two parts. One is to allow Hongkong investors to invest in the Shanghai Stock Exchange of < a href= "http://www.91se91.com/news/index_c.asp" > A share market < /a >, and the two is to allow mainland investors to invest in Hong Kong stocks.

The establishment of Shanghai Stock Exchange is actually equivalent to the opening of a return channel to the A share market for offshore RMB funds.

From the perspective of currency and investment direction, it is more similar to the existing RQFII system, but its investors are more extensive and its investment autonomy is stronger. It helps further enrich the variety of RMB investment and give full play to the attraction of RMB as an investment currency.

The general principles of Hong Kong stocks provide a channel for domestic investors to invest in foreign securities. At the same time, the Shanghai and Hong Kong exchanges through renminbi will be beneficial to the expansion of cross border use of RMB and the active offshore RMB market.

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< p > however, for the sake of conservatism, the regulatory authorities of both places have stricter restrictions on the investment quota, investment target and investor threshold of Shanghai and Hong Kong.

Not only that, Shanghai and Hong Kong through the implementation of closed path management of funds, the funds to sell securities must return along the original path, can not stay in the local market.

This series of regulations shows that the regulatory authorities are more cautious about cross-border capital flows. Although effective implementation of risk management and control, it also limits investors' operating space to some extent, partly affecting the enthusiasm of investors.

Moreover, whether the two-way investment channels can fully play the role of dredging funds also depends on the attractiveness of the two stock markets.

After the formal opening of Shanghai and Hong Kong, the impact on cross-border capital depends to a large extent on the market and economic situation.

From now on, there may not be large-scale fluctuations at the beginning.

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< p > < < a > href= > http://www.91se91.com/news/index_c.asp > Shanghai and Hong Kong > /a > by promoting the reform of the mainland capital market system, enhancing its internationalization level, and thus bringing long-term benefits to RMB internationalization.

RMB as an international currency should be accepted by investors all over the world. The A share market with high efficiency and good liquidity is an important support.

At present, institutional investors in the world are reluctant to participate in the A share market. In addition to market access and capital account control, they are also related to imperfect market supervision and institutional environment and low level of governance of listed companies.

The introduction of Shanghai and Hong Kong links will connect the two stock markets. The ensuing institutional competition will force the A share market to match the trading system and regulatory rules of Hongkong's mature capital market as soon as possible, in order to facilitate investors to invest while enhancing their attractiveness.

Market expectations, the introduction of the blue chip T+0 mechanism and the reform of the delisting system will become the starting point for the integration of the two cities in Shanghai and Hong Kong.

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< p > in addition, the interaction between investors' investment behavior and investment philosophy will enhance the trading level of investors and optimize the structure of investors.

Through participation in the Hong Kong stock exchange, mainland investors can gradually become familiar with the operation ideas of international capital markets and learn from the investment ideas of international investors. Foreign institutional investors with strong legal awareness and awareness of rights protection enter the A share market, which can promote the improvement of the governance level of listed companies, and promote the improvement of regulatory system through their regulatory demands.

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< p > finally, the opening of Shanghai and Hong Kong will enhance the linkage between the A share market and the international capital market, which at the same time implies an increase in the spillover effect of the international capital market on the A share market.

The process of gradual adaptation and control of this effect is also a process to improve China's capital market risk prevention system and enhance market resilience. It lays the foundation for further improvement of China's capital market internationalization level in the future.

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< p > we can say that Shanghai and Hong Kong have accelerated the deepening of the reform of the capital market, and open and effective capital market will become an important support for the expansion of RMB internationalization.

From this perspective, the promotion of RMB internationalization by Shanghai and Hong Kong not only lies in the opening of current two-way channels of capital, but also in shaping the future competitiveness of RMB.

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