This article was written by David Olsson.
KWM welcomes the release this week of the Official Report of the Renminbi Global Cities Dialogue, 2017. The Dialogue, held in Sydney in April 2017, was a world-first, with representatives of more than half of the 22 official RMB hubs attending to discuss the development paths for the offshore RMB markets and to explore opportunities for hub collaboration.
The Official Report provides an overview of the current state of the offshore RMB markets and a frank assessment of the challenges faced by the RMB hubs and market participants.
Overall, despite the current global slowdown in the use of RMB as a settlement currency, delegates agreed that RMB will continue to gain prominence in the future. Potential drivers of the RMB internationalisation process include:
- increasing fintech investment and the growth of e-commerce and payment platforms;
- the prospect of RMB as a digital currency overseen by a digital central bank;
- newly announced policy changes designed to encourage overseas companies to play a bigger role in China's economy (including its financial sector) – presenting opportunities for foreign investors seeking to tap into China's market potential;
- continued outbound Chinese investment; and
- over time, RMB financing to support China's Belt & Road infrastructure initiative.
The Official Report notes that as the use of RMB grows intentionally, it will be essential that the offshore markets are well connected. While hubs have so far competed against other centres for a right to be an official offshore RMB hub in a particular geographic region, there is now a need to examine how hubs might work more collaboratively with each other. Ultimately, a renewed effort by RMB hubs to work together will support the development of the offshore RMB markets to better serve the needs of customers, businesses and investors.
About the Dialogue
The inaugural RMB Global Cities Dialogue was held in Sydney, Australia from 27-28 April 2017. It brought together over 175 global business leaders, policymakers and industry players from 14 countries in a series of sessions that challenged preconceptions and assumptions, and encouraged delegates to consider a framework for a new type of engagement between hubs - one which is less about competition and more about collaboration.
The Dialogue was organised by the Sydney RMB Committee and hosted by the New South Wales Government. Keynote speakers included the Hon Gladys Berejiklian (Premier of New South Wales), Dr Fan Yifei (Deputy Governor of the People's Bank of China) and Dr Philip Lowe (Governor of the Reserve Bank of Australia). Over 30 other speakers and panellists led though-provoking and insightful sessions over 2 days.
King & Wood Mallesons was pleased to be a lead corporate sponsor of the event, with partner Scott Farrell leading a session on the impact of technology on the global payments systems. David Olsson, China Practice Consultant to the firm, is Chair of the Sydney RMB Committee and was MC of the Dialogue.