USD, EUR, GBP, JPY, CNY... The competition of these currencies in the international payment market is like a fierce "currency war", and new war reports are released every month.
The latest data shows that in September, the US dollar still dominated international payments, accounting for 46.5%. The euro suffered a heavy setback, falling to 23.6%, the lowest in recent years. The pound sterling and the Japanese yen maintained steady growth, accounting for 7.32% and 4.2% respectively.
So, what about the RMB? As the currency of the world's second-largest economy, how does the renminbi perform in international payments?
The answer: RMB accounted for 3.71% of international payments, ranking fifth in the world, up from August. Moreover, the amount of RMB payments increased by 2.7% despite a decrease in global monetary payments.
This data does not look too impressive, and even a little disappointing. However, if we look at it from another perspective, we will find the potential and advantages of RMB in international payments.
First of all, we must know that the SWIFT system is an international settlement system based on the hegemony of the US dollar, which does not fully reflect the true share of national currencies in international trade.
Sino-Russian trade, for example, is a good example. Because Russia is sanctioned by Europe and the United States and cannot trade with other countries through the SWIFT system, more than 80% of China-Russia trade has been settled in local currency, which has long bypassed the US dollar.
According to data released by customs, from January to September this year, the trade volume between China and Russia reached 176.4 billion US dollars, an increase of nearly 30% year-on-year, which has exceeded the trade volume between China and Germany (158 billion US dollars), and the scale of Sino-Russian trade is still accelerating.
None of these figures are factored into the SWIFT system, so the true share of RMB in international payments is much greater than 3.71%.
In addition, it should be emphasized that the RMB has made remarkable progress in global cross-border trade, which cannot be ignored.
According to another set of data released by SWIFT, the market share of the euro has fallen to 5.4%, while the market share of the yuan has risen to 5.8%. This marks the first time the renminbi has surpassed the euro to take second place.
What does this mean? This means that the renminbi has successfully penetrated the European market and is challenging the dominance of the euro in the European region.
This is a very significant achievement, as Europe is one of the world's largest single markets and one of China's most important trading partners. If the renminbi can gain more recognition and use in the European market, it will have a very positive impact on economic cooperation between China and Europe.
Third, we should note that the growth of RMB in international payments has been achieved with the support of the RMB Cross-border Payment System (CIPS) independently established by the mainland.
CIPS is an independent cross-border payment system established by the mainland to promote the internationalization of RMB, which can enable RMB to achieve more convenient, efficient and secure settlement worldwide.
In the first half of this year, CIPS handled 1.62 million transactions, a year-on-year increase of 60%, handling RMB 54.6 trillion yuan, and the amount of RMB processed throughout the year is expected to exceed 100 trillion yuan.
These data show that CIPS has become an important platform and tool for the internationalization of RMB, providing strong support for RMB in international payments.
To sum up, we can see that the performance of the renminbi in international payments is not as bad as it seems, on the contrary, it has many highlights and advantages.
Of course, we can not ignore the strong position of the dollar in international payments, it has been laid out and built for more than a hundred years, although the world is "de-dollarization", but the hegemony of the dollar has not been replaced in the short term.
Therefore, if the RMB wants to occupy a larger share in international payments, it needs to continue to move forward in order to achieve stability and long-term success.