Thread by @ChinaFinance40

The re-start of #RMB internationalization could finally help get rid of the “#originalsin” of currencies in emerging market, said CF40 member Guo Kai, mp.weixin.qq.com/s/kCLviAhMXdx4…. 1/6

It will greatly reduce the negative impact of exchange rate fluctuations, capital flow fluctuations and “#longarmjurisdiction” in other countries. 2/6

Eichengreen and Hausmann have proposed the “original sin” of currency in 1999, arguing that because currencies of developing countries are not international, they cannot be used for external borrowing or even domestic long-term borrowing. 3/6

The “long-arm jurisdiction” of other countries usually relies on the irreplaceability of their currencies in the short and medium term. Accelerating the internationalization of the RMB will help reduce the dependence of Chinese financial institutions on other currencie. 4/6

Financing is an important part of the “#BeltandRoad” construction. At present, the circulation of production factors such as goods, services and capital in the “Belt and Road” construction is mainly settled in the US dollar, a third-party currency. 5/6

Using RMB in the “Belt and Road” construction will be more convenient, which will help all parties to effectively alleviate currency mismatches, avoid exchange rate risks, promote the development of trade and investment, and achieve complementary advantages and risk sharing. 6/6