The Local Sources of Financial Opening : the Case of Renminbi Internationalization
Abstract
This study unravels the subnational foundation of China’s monetary outreach, notably its recent years’ endeavor to promote renminbi internationalization. Contrary to most analyses in economics and policy literatures that conceive the importance of the central authorities in China’s pursuit of external monetary policy objectives, policy making dynamics underlying the evolution of the different tracks of renminbi internationalization, including trade settlement, offshore bond market and derivative and equity products, suggest a far more complicated picture about the political origins of the internationalizing venture of renminbi. Through extensive review of published materials in Chinese and interviews with financial officials, local authorities of offshore and onshore financial hubs, including Hong Kong, Shanghai and Shenzhen, are found to have played important parts in defining the central government’s agenda, shaping the technical parameters of the policy debate within and implementation specifics like scope, pace and timing of the currency outreach. These findings points to the imperatives of going beyond the national level of analysis and looking into the subnational dimension of financial opening often overlooked by researchers.
Speaker
Vic Yu-wai Li obtains his PhD from the Balsillie School of International Affairs, Wilfrid Laurier University, Canada, and specializes in global political economy. His current research explores domestic political dynamics of China’s financial opening and its implications to the international financial order and monetary relations.