Chinese Yuan Bilateral Currency Swap Agreements. Nowadays internationalization of renminbi rises as many counties try to lessen their dependence on U.S. dollar. P.B.O.C. uses different instruments to drive expansion of RMB, weakening the U.S. dollar monopoly in the basket of the world reserve currencies. By 2013, the RMB is the 8th most traded currency in the world. On 17 August 2010, PBoC issued policy to allow Central Bank, RMB offshore Clearing Banks and offshore Participating Bank to invest the excess RMB in debt securities, in onshore Inter-bank Bond Market. In October, China further open up both FDI and ODI in RMB (Pilot RMB Settlement of Outward Direct Investment) and nominated Xinjiang as the first pilot province (which in early 2011 expanded to 20 pilot areas). In June 2013, United Kingdom became the first G-7 country to set up an official currency swap line with China. As of July 2014, 25 countries have signed the RMB Bilteral Swap Ageeement with PBoC with total facilities of over ¥2.7 trillion. These agreements tell us that China decided to increase the role of RMB in the world currency market.
2007: Creation of Dim Sum bonds and offshore RMB bond market
The dim sum bond market generally refers to RMB-denominated bonds issued in Hong Kong. The majority of dim sum bond are denominated in CNH, but some are linked to CNY (but paid in USD). In July 2007, dim sum bonds worth a total of US$657 million were issued for the first time by China Development Bank. These financial assets were issued to foreign investors in renminbi, rather than the local currency.
In June 2009, China allowed Financial Institutions in Hong Kong to issue dim sum bonds. HSBC was the first FI that issued RMB Bond (dim sum bond). In August 2010, McDonald was the first corporate that issued dim sum bonds. In October, the Asian Development Bank (ADB) raised a ¥1.2bn 10-year bond, and