Introduction

This special section,edited by Yin-Wong Cheung and Iikka Korhonen,assesses the long and complex process of the renminbi(RMB)internationalisation from several different angles.The overall progress has been quite remarkable in some areas,but clearly much more cautious in other areas.Chinese authorities’caution in,for example,opening up capital accounts in a significant way can be explained by several cautionary examples of premature capital account liberalisation and subsequent economic dislocations.As long as the movement of capital across the Chinese borders remains controlled in the current fashion,the international use of the RMB will also remain limited.On the other hand,the steady growth of China’s economy will boost demands for Chinese assets,including assets denominated in the RMB.This process will,in its part,help increase the international use of the RMB.

Introduction

While a truism,it bears repeating that China’s emergence as the world’s second largest economy(with the gross domestic product measured at market exchange rates)during the past four decades is one of the greatest economic success stories in the modern economic history.Growth of China’s economy has helped lift literally hundreds of millions of people out of poverty.Also,in the process China has become the world’s largest exporter,signifying China’s growing integration with the rest of the global economy.