After China and Brazil signed a cooperation memorandum of understanding on the establishment of RMB settlement arrangements in Brazil earlier this year, ICBC Brazil has successfully handled the first "cross-border RMB settlement" business, and the trading parties no longer use the US dollar as the intermediate currency. According to the analysis, the settlement function is a major manifestation of currency internationalization. Against the background of the increasing risk of U.S. debt default, some major trading countries tend to use non-dollar currencies for international settlement. The completion of the first cross-border RMB settlement transaction for natural gas (LNG) has promoted the facilitation of bilateral trade and investment, opened up space for the advancement of RMB internationalization, and also released a signal that the international market's recognition of RMB has increased. \Ta Kung Pao reporter Ni Weichen reports

　　In February this year, the PBOC authorized ICBC Brazil to act as the RMB clearing bank in Brazil. According to ICBC Brazil, the first cross-border RMB settlement business between China and Brazil has shown significant advantages in terms of clearing efficiency, exchange costs, capital flow and information flow security. The Brazilian Trade and Investment Promotion Agency has previously pointed out that the settlement of local currency between Brazil and China will reduce costs, promote greater bilateral trade, and facilitate investment between the two parties.

　　It is not surprising that China and Pakistan carry out cross-border settlement in RMB. According to Chinese customs data, the bilateral trade volume between China and Pakistan last year was 171.49 billion US dollars, a year-on-year increase of 4.9%. Brazil's official statistics also show that by 2022, Brazil-China trade volume has exceeded US$100 billion for five consecutive years, and China has become Brazil's largest trading partner for 14 consecutive years. Coincidentally, the Central Bank of Brazil also announced earlier that the renminbi has surpassed the euro to become the country's second largest international reserve currency.

　　Chang Ran, a senior researcher at Zhixin Investment Research Institute, said that the successful handling of the first cross-border RMB settlement between China and Pakistan will help expand China's trade circle of friends and facilitate the orderly advancement of RMB internationalization. "China-Pakistan RMB trade settlement is a It is a positive signal and does not rule out a positive spillover effect in the future." According to her analysis, the current U.S. federal government debt is 31.4 trillion U.S. dollars, which has reached the debt ceiling. In the context of the increasing risk of U.S. debt default, some major trading countries may prefer to use non-dollar currencies for international settlement.

　　Expert: There are cracks in the dollar central system

　　After just finishing his visit to China, Malaysian Prime Minister Anwar said in the Malaysian Parliament a few days ago: "Malaysia has no reason to continue to rely on the US dollar." He revealed that the Malaysian central bank has discussed with the Chinese side to directly use Malaysian ringgit and RMB for trade settlement Mechanisms. It is worth mentioning that in the recent stage, the RMB international trade settlement has gradually increased, and the market has paid more and more attention to the phenomenon of "de-dollarization". In February this year, the Central Bank of Iraq announced that it would allow direct settlement of trade with China in RMB. Coincidentally, in March this year, China’s first purchase of imported LNG settled in RMB was concluded. The volume of imported LNG settled in RMB was about 65,000 tons .

　　Zhang Wenlang, chief macro analyst of CICC, believes that in the short term, "de-dollarization" reflects the cracks in the global monetary system centered on the "dollar" against the backdrop of geopolitics. In the long run, "de-dollarization" reflects that the international status of the US dollar has begun to converge to the economic status of the United States, which is also a manifestation of global "de-financialization".

　　Improve the Hong Kong and offshore markets and expand international settlement channels

　　Looking forward to the future, Chang Ran emphasized that "the internationalization of the RMB in the future will be an all-round and multi-level process of steady progress." She suggested that the re-expansion of international trade and investment clearing and settlement should be gradually realized, including promoting the PBOC to establish clearing arrangements with more foreign monetary authorities and expanding the scale of currency swaps. At the same time, actively promote the high-quality development of the "Belt and Road" and RECP regional economic and trade cooperation, and expand channels for RMB international settlement. In the future, we should strengthen the macro-prudential management and supervision capabilities of full-scale cross-border capital flows, orderly promote the convertibility of RMB under the capital account, and vigorously build and develop offshore financial markets, including improving Hong Kong’s offshore market, and promoting Hainan’s Free trade port financial openness and innovation.

　　Zhang Wenlang pointed out that in the macro-environment of anti-globalization and de-financialization, the competitiveness of China's real economy has become more important to the internationalization of the RMB. The promotion of RMB internationalization does not need to focus on "capital account opening", but more Emphasize the competitiveness and technological innovation of the real economy, and promote cooperation between China and other countries in the fields of payment and finance through trade and real investment partnerships.