RMB'S Influence On SDR Is Too Great.

After the RMB has been incorporated into the SDR, if the internal reform can not keep up, the capital market will be forced to open up, which will create a very passive situation.

Anyway, joining SDR is a milestone event. Without opening up and without reform, China's economy will not be able to achieve rapid growth.

In November 30th, the Executive Board of the International Monetary Fund (IMF) decided to include Renminbi in the basket of special drawing rights (SDR) currencies.

As a result, the renminbi became the fifth currency after the US dollar, euro, pound and Japanese yen joined the SDR basket of currencies.

This is a substantial step in the internationalization of RMB, which is no less important than China's accession to the World Trade Organization (WTO) at the beginning of this century.

China's accession to the WTO has been a strong driving force for China's economic growth. China has become the world's largest commodity trading country and the largest foreign exchange reserve in the following more than 10 years.

It should be affirmed that joining WTO is a great achievement.

At present, China's economy is experiencing downward pressure, and related reforms involve deep-water areas such as economic restructuring and RMB internationalization.

In such a sensitive period, it should not be too unrealistic to imagine that RMB should be included in the SDR. After the RMB was included in the currency basket, China's economy, exports and credit will naturally improve.

But joining the SDR is indeed the engine to promote the internationalization and reform of China's economy. China can deepen reform and opening up in depth.

The inclusion of Renminbi in SDR is a process in which the global financial system and China have "you have me, I have you".

This RMB is added.

Ranked third in the weight list, after the US dollar and the euro, before the yen and the pound.

In July of this year, IMF workers calculated that the weight of the RMB in the SDR currency basket would be 14% ~16% (about 14% of HSBC).

According to a recent report by an unnamed insider, the weight of the renminbi is less than originally expected because the IMF policymakers changed the calculation method of the weights of each currency in the reserve basket to reduce the importance of export volume.

"Entering the basket" also means that RMB internationalization has entered a new stage.

Usually, the internationalization of a currency requires three functions: settlement currency, investment currency and reserve currency.

"Entering the basket" marks the internationalization of RMB into the reserve currency stage.

At the same time, with the RMB being used more frequently in financial pactions, the internationalization of RMB will have more favorable conditions.

In the short term, the impact may be limited.

Zhu Haibin, chief economist at JP Morgan, believes that central banks and sovereign wealth funds interested in Renminbi assets have allocated renminbi assets and are unlikely to substantially increase renminbi assets in the near future.

Similarly, there will be no significant increase in the use of RMB in the global financial market in the short term.

After initial allocation, whether the institutions are willing to hold renminbi assets and whether China can integrate with the international, RMB and foreign currencies can be decided by China's reform process and the attractiveness of the RMB market.

An increase in exchanges with major international markets can ease the downward pressure on Renminbi assets.

In the difficult pition period of China's economy, there are only two ways to ensure exchange rate stability, or to close the market, to prevent the risk of shorting renminbi assets pactions, or to open up as soon as possible, making RMB an important member of the global market.

This is just like the US dollar.

Like other markets, the downside crisis of US dollar assets has naturally become a global crisis. Therefore, protecting the stability of US dollar assets has become an important step to protect ourselves.

In the sharp fluctuations of the US dollar and euro markets, US, European and Japanese currencies exchanged and supported each other through the cold winter.

Only when China enters the mainstream market will it become a community of interests.

The mutual responsibility and obligation of the interest community is the first step in rational interaction and will not be bound by extreme consciousness.

After the internationalization of the RMB, we will enforce international rules in all aspects, such as trade, domestic market and credit market. China can only overcome its strong resistance only by strengthening its reform momentum.

The sober perception of reform is that external help is always external and the core is internal reform.

Since China's accession to the WTO, although it has become the world's largest trading nation, its internal mechanism has gradually been exposed. The zombie enterprises and the rent-seeking economy have not been alleviated by the economic rise.