When President Hu Jintao at the G20 summit in London urged the diversification of the international monetary system and called for the development of operational time table,  more and more countries and regions begin to use renminbi as foreign exchange reserves, and wait for an opportunity to buy government bonds and corporate bonds in China.

At the end of Day 2 on the G20 summit, President Hu Jintao stressed the need to improve the international monetary system, and promote diversification and rationalization of the international monetary system.  The parties should, on the basis of full consultation,  work on the development of a timetable for the operation and the road map.

On the same day, the People's Bank of China and the central bank of Argentina formally signed up to 700 billion the total amount of currency swap agreements, so that through this way to allow the yuan to become the reserve currency of the countries and regions.

In less than 4 months between the G20 summit in Washington and the G20 summit in London, China has signed currency swap agreement successively with the Korean, Malaysia, Belarus, Indonesia, Argentina

The Country's central bank and the Hong Kong Monetary Authority signed a total of six copies of the 650 billion yuan currency swap agreements, and the exchange period was extended to 3 years.

RMB currency swap is only a step towards internationalization.  It is usually believed that the internationalization of the RMB have to go through three stages: for trade settlement in RMB;  to carry out financial transactions denominated in RMB; for the yuan to become one of the world's reserve currencies.

Some experts point out that the State Council’s view on Promoting the construction of Shanghai international financial center before, as well as the effort to launch a pilot program of the yuan trade settlement in some places, are also important nodes on the "road map” of  the internationalization of the yuan.

The State Council’s view issued last week regarding the construction of "two centers" in Shanghai made it clear that by 2020, Shanghai will be built as an international financial center appropriate to China's economic strength and international status of the renminbi.

"The establishment of an international financial center in Shanghai is a strategic intent for RMB internationalization." Shanghai Academy of Social Sciences, Institute of The World Economic Research, deputy director Mingqi Xu told reporters.

Earlier, a State Council executive meeting allowed the RMB trade settlement pilot program between the Yangtze River Delta, Guangdong, and Hong Kong, Macao regions, and between Yunnan, Guangxi and ASEAN.

According to reports, Guangzhou, Shenzhen, Dongguan, Zhuhai is expected to become the first pilot cities with yuan trade settlement, clearing banks are likely to include the Shanghai Branch of Bank of China, Bank of Communications, China Construction Bank and China Merchants Bank branch in Guangzhou.

In fact, China and the neighboring countries began to use the RMB in the border trade settlement in the early 90's in the last century.  According to some people from the central Bank in charge of the introduction, so far, China has signed the border-trade-local-currency settlement agreements with eight countries’ Central Banks including Vietnam, Mongolia, Laos, Nepal, Russia, Kyrgyzstan, Kazakhstan, North Korea.  Last year's RMB clearing was about 230 billion yuan.

Li Ruogu , Export-Import Bank of China, even thinks the RMB has been "semi-international."  On the one hand, border trade has been part of settlement with the RMB.  On the other hand, UnionPay cards can uses in a lot of places in foreign countries, and this is also for trade settlement in RMB.

"Next, the RMB internationalization needs more policy support." Li said, "the Government should consider allowing foreign purchase of treasury bonds and corporate bonds in China, which involves the issue of opening up the capital account."

Experts advise that the process of internationalization of the yuan should pay attention to the prevention and control of risk.

"RMB internationalization is a good thing, but be steady, one step at a time." Li said.  "When the yuan is similar to the U.S. dollar, with the total flow of two-thirds in foreign countries, the foreign absorption capacity of the RMB will affect China's monetary policy."

Xu also pointed out that, "given the circumstances that capital account is not open, there is a need to prevent hot money flowing into China under the guise of trade, and impacting the capital market."