Come June, the International Monetary Fund will probably decide to include the Chinese renminbi in its special drawing rights (SDR).
Though the move is largely symbolic, the symbolism is huge. It is another acknowledgment of China’s growing stature in the global economy and financial markets. It is also a marker underscoring how swiftly China is moving to dismantle capital controls, in line with the reform policies of the People’s Bank of China.
That in turn has implications for investors. It will mean China could soon assume an even larger weight in crucial global financial markets. For example, today, China is a mere 2.5 per cent of the MSCI All Country World Index, based on Chinese companies listed in Hong Kong. But, when the powers that be decide the currency is convertible enough, onshore Chinese shares could be included in the index, which means its share of the index could rise to more than 10 per cent, according to Michael Cembalest of JPMorgan Asset Management.
这进而会对投资者产生影响。此举将意味着，不久之后中国可能会在关键的全球金融市场中占据越来越大的权重。举例来说，目前中国在摩根士丹利资本国际全球指数(MSCI All-Country World Index)中的权重仅为2.5%，这个数字是基于在香港上市的H股得出的。但是，当权威人士认定人民币可兑换性已足够强时，A股可能会被纳入该指数。摩根大通资产管理公司(JPMorgan Asset Management)的迈克尔·琴巴莱斯特(Michael Cembalest)表示，这意味着中国在该指数中所占权重可能会升至10%以上。
Today, the renminbi is most visible as the currency in which a growing portion of Chinese trade is denominated. Chinese companies often offer more attractive prices and financing to counterparts that will trade in renminbi, thereby eliminating their own foreign exchange risk.
More importantly, the renminbi is also growing in stature as an investable currency. Today, Mr Cembalest adds, central banks and sovereign wealth funds have invested between Rmb300bn and Rmb400bn in renminbi-denominated assets. While most of these are in Asia, the European Central Bank has also said it is considering investing in such assets.
Moreover, Japanese central bankers say they are considering agreements whereby the Bank of Japan and the PBOC would expand investing in each other’s government bond markets (assuming the forthcoming anniversary of the end of the second world war does not lead to a new outbreak of hostilities between the two countries). The two central banks are also considering resuming swap lines. China already has almost Rmb10tn of such arrangements with 30 central banks.
Meanwhile, China’s young asset management groups and securities firms are designing ever more products in local currency both onshore and offshore, where Rmb2tn in deposits sits, most of them in Hong Kong.
China does not have to remove all controls on its currency, particularly rules on portfolio investment flows, for it to qualify for inclusion in the IMF basket. Even today, only four items out of 40, or less than 15 per cent of the capital account, have restrictions, according to Qu Hongbin, chief China economist for HSBC in Hong Kong. After all, even Singapore and Hong Kong retain some constraints on their currencies. The Chinese government’s willingness to remove restrictions on the renminbi comes in the face of widespread fears, especially outside China, of slowing economic growth on the mainland and of a possible debt crisis, given the fact that debt in China has grown by 70 per cent since the global financial crisis in 2008.
The combination of offshore flows from various conglomerates and diminishing returns on domestic investment suggests that as China lifts controls, at least over a short period of time, the renminbi will lose value. After all, in the past three quarters, there has been about $333bn in outflows of hot money from China, (much of them from companies hedging or repaying their dollar debt). Moreover, reserves, which ended the year at $3.8tn, declined to $3.73tn at the end of the first quarter.
形形色色的企业集团将资金转往海外，而国内投资回报又不断下降，这两点结合在一起，意味着假如中国解除人民币管制，人民币至少在短期内将会贬值。毕竟，过 去3个季度，有大约3330亿美元热钱流出了中国（许多都是通过企业对冲或偿还美元债务的方式流出的）。此外，截至今年一季度末，中国外汇储备从去年底的 3.8万亿美元降至3.73万亿美元。
So far, the renminbi has been one of the few currencies to hold its value against the dollar in a world of increasing competitive devaluations. China has recently started to ease monetary policy, but is trying to do so in a more measured way than either Japan or Europe. A one-time competitive devaluation to support exports is less attractive to the Chinese than the gradual appreciation that makes its currency attractive as a store of value. The growing legitimacy of the renminbi also comes at a time when the rest of the world is looking for a credible alternative to the dollar as the only real reserve currency. Cliff Tan, MUFG economist, jokes that the acronym SDR should stand for “some day renminbi”. That “some day” is fast approaching.
在世界各国的竞争性货币贬值愈演愈烈之际，人民币迄今为止是少数几个相对美元币值保持坚挺的货币之一。中国最近开始放松货币政策，但相对于日本或欧洲，中国在努力以更谨慎的方式做这件事。对中国来说，与其实施一次性的竞争性贬值以支持出口，不如缓慢升值以增加人民币作为价值储藏手段的吸引力。此外，人民币正统地位日益增强的同时，世界其余国家正在寻找美元的可靠替代品，以作为唯一的实际储备货币。三菱日联金融集团(MUFG)经济学家陈仲华(Cliff Tan)戏称，SDR这个英文缩写应该代表“some day renminbi（有朝一日将是人民币）”。这一天正迅速临近。