China-ASEAN Free Trade Zone opens the zero-tax era RMB internationalization springboard

The world's largest free trade zone, the China-ASEAN Free Trade Area, was officially launched on January 1, 2010. More than 90% of China and 10 ASEAN countries will implement zero tariffs on more than 7,000 products. This region, with a GDP of nearly $6 trillion and a trade volume of $4.5 trillion, has since entered the era of zero tariffs.

The economic and trade relations between the two sides have developed rapidly. According to the goal set by the China-ASEAN Framework Agreement on Comprehensive Economic Cooperation in November 2002, China and ASEAN will fully build a free trade zone in 2010. After seven years of joint efforts, the two sides signed the "Goods Trade Agreement", "Service Trade Agreement" and "Investment Agreement".

From January 1, 2010, between China and ASEAN six old members, namely Brunei, the Philippines, Indonesia, Malaysia, Thailand and Singapore, more than 90% of the products will be zero-tariff, and China’s average tariff to ASEAN will be 9.8% fell to 0.1%; the average tariff of six ASEAN members to China will be reduced from 12.8% to 0.6%. Four new members of ASEAN, namely Vietnam, Laos, Cambodia and Myanmar, will achieve the 90% zero tariff target in 2015.

Since the signing of the "Comprehensive Economic Cooperation Framework Agreement", the economic and trade relations between the two sides have developed rapidly. The trade volume has increased from about 60 billion US dollars in 2002 to 231.12 billion US dollars in 2008, with an average annual growth rate of 24.2%.

Thai Ambassador to China Wang Yisheng said that after the completion of the China-ASEAN Free Trade Area in 2010, bilateral trade volume will continue to record high. It is expected that the annual trade volume will increase by 40% to 50%, or higher. .

Further optimization of bilateral trade structure Zhang Kening believes that the reduction of tariffs by the China-ASEAN Free Trade Area not only makes the bilateral trade volume increase rapidly, but also allows the bilateral trade structure to be further optimized.

For example, Zhang Kening said that although China and ASEAN are both export-oriented, there are still many complementary products and industries. For example, China exports to ASEAN faster, more ships, steel, knitted garments, ceramic products, and imports of copper products, rubber products, cocoa products and other resource-based products. In addition, the proportion of China's mechanical and electrical products to ASEAN exports increased from 39.5% in 2003 to 50% in 2008.

According to the analysis report released by Guojin Securities, the proportion of exports from various industries to ASEAN is chemical fiber, transportation equipment, steel, chemicals, glass ceramics, etc. From the historical data of the industry, the proportion of chemical fiber continues to rise; the current proportion of steel is at a low point, although there is room for recovery, but the overall pull of the domestic steel industry is relatively limited; chemical products steadily rise. Therefore, the establishment of chemical fiber (textile machinery) and chemical products in the China-ASEAN Free Trade Area may be more prominent in the medium term. From the perspective of economic development of ASEAN countries, many are agricultural countries, which have great demand for China's agricultural machinery and agricultural production materials. At the same time, the cooperation between the two sides in the machinery processing industry, textile industry, engineering contracting, electrical appliances, instrumentation industry will also have a lot of room for development.

The internationalization of the RMB has taken the China-ASEAN Free Trade Area to be fully launched on January 1, 2010. The China-ASEAN Free Trade Area has become a large free trade zone composed of developing countries and will also serve as a springboard for the internationalization of the renminbi.

Experts said that currency internationalization is generally divided into three stages: one is the circulation and use of money in the surrounding areas; the other is that currency becomes the valuation, settlement and circulation currency of trade and financial transactions in the surrounding areas, that is, the regionalization of currency. This is the initial stage of currency internationalization; the third is that money becomes a reserve currency and achieves true internationalization. At present, the ASEAN region has advantages and opportunities in terms of the degree of acceptance of the RMB, the breadth of circulation and the convenience of payment.

At present, China's trade volume with the ASEAN Free Trade Area has been quite large. In 2008, the bilateral trade volume reached US$231.12 billion. In 2009, despite the economic crisis, the trade volume between China and ASEAN countries in the first 11 months still reached US$187.05 billion. Regardless of population size and growth potential, this region will become a fast-growing region in the world in the future. The demand for the use of RMB for pricing settlement in the Free Trade Zone is growing.

Since the international financial crisis, the regulatory authorities have introduced cross-border trade renminbi settlement, which is the first to promote its use in ASEAN countries. In addition to the promotion of the system level, if the renminbi wants to become a regional currency, it needs market recognition and acceptance. It can be seen that since the international financial crisis, the depreciation of the US dollar has caused huge foreign exchange losses in the use of the US dollar as a payment settlement. The RMB has remained relatively stable and has become a relatively strong currency in the region. Willingness to settle.

On the eve of the official completion of the China-ASEAN Free Trade Area, the 10+3 finance ministers and central bank governors and the president of the Hong Kong Monetary Authority announced the formal signing of the Chiang Mai Initiative Multilateralization Agreement, which will also promote the use of the RMB for payment settlement in the ASEAN region. The original intention of the agreement is to cope with short-term liquidity problems, effectively cope with the financial crisis, and maintain the stability of the financial system. However, the innovative mechanisms in the agreement, such as supporting swap funds for trade financing, will promote the renminbi pricing in the trade of the free trade zone. Settlement.

In order to comprehensively promote economic and financial cooperation in the China-ASEAN Free Trade Area, relevant departments have indicated that they will introduce measures to promote investment facilitation in the region. In the future, the cooperation in the free trade zone, whether in the trade field or in the capital market, will be deepened. These measures will solve the problem of the return channel of the renminbi, so that the renminbi will have more extensive use space after being accepted by overseas enterprises.