How to promote the internationalization of RMB in the next step? How to support the healthy development of offshore RMB market? How to strengthen the supervision of cross-border RMB business? The People's Bank of China gave directions in the Report on RMB Internationalization (2024) (hereinafter referred to as the Report) released on the evening of September 30. The central bank stated that in the next stage, it will be based on market driven and enterprise independent choices, coordinate development and security, focus on trade and investment facilitation, steadily and solidly promote the internationalization of the renminbi, and better serve the real economy and high-quality development. The report proposes to further facilitate the use of RMB by business entities in foreign trade and investment. Specifically, we need to focus on the needs of the real economy and strengthen the coordination of domestic and foreign currencies on the basis of prioritizing the local currency. Further improve the integrated management of domestic and foreign currency loans for enterprises overseas, optimize policies related to cross-border enterprise group fund pools, and coordinate and standardize cross-border asset transfer businesses such as trade financing. Guide commercial banks to optimize cross-border RMB financial services. Promote innovation in RMB cross-border investment and financing business around the construction of free trade pilot zones (free trade ports), the Guangdong Hong Kong Macao Greater Bay Area, and the Shanghai International Financial Center. In the column titled "Promoting Innovation in Cross border RMB Business to Support the Construction of Shanghai International Financial Center", the People's Bank of China stated that in the next step, it will continue to focus on the strategic task of building Shanghai International Financial Center, adhere to serving the real economy, promoting trade and investment facilitation as the starting point, and promote relevant reforms and innovations in accordance with the principles of leading by example, orderly promotion, controllable risks, and gradual improvement. It will better play the role of Shanghai's financial reform "experimental field", solidly promote high-quality financial development, and continuously enhance the competitiveness and influence of the international financial center. In promoting the high-level opening-up of China's financial market in a steady and orderly manner, the Report proposes to enhance policy transparency, regularity, and predictability, improve the liquidity of RMB financial assets, enrich risk hedging tools, and better meet the needs of global investors for RMB asset allocation and risk management. Encourage and support eligible overseas institutions to issue Panda bonds domestically. When it comes to supporting the healthy development of the offshore RMB market, the report points out that it is necessary to make good use of mechanisms such as currency swaps and RMB clearing arrangements to provide stable RMB liquidity for the offshore market. Improve the long-term mechanism for issuing overseas sovereign bonds and increase the supply of RMB safe assets. Make good use of the standing exchange arrangement with the Hong Kong Monetary Authority, optimize and expand the interconnection mechanism between the mainland and Hong Kong financial markets, strengthen Hong Kong's position as an offshore RMB hub, and enhance the functions of other offshore RMB markets. In terms of improving the infrastructure for the use of the renminbi, the report points out that it is necessary to enhance the functions of clearing banks, optimize their global layout, and increase policy support for clearing banks. Support the continuous expansion of the coverage area of the Chinese Yuan Cross border Payment System (CIPS), providing more efficient and convenient RMB clearing services. In terms of strengthening the supervision of cross-border RMB business, the central bank has stated that it will improve the construction of self regulatory mechanisms for banks, strengthen the front-line responsibility of banks to prevent cross-border fund flow risks, enhance the compliance awareness and capabilities of financial institutions, and strengthen in-process and post event monitoring and management. Establish a sound macro prudential management framework for cross-border capital flows that integrates domestic and foreign currencies, continuously enhance regulatory capabilities and risk prevention levels under open conditions, build a solid "breakwater", and ensure the steady progress of RMB internationalization while maintaining a safe bottom line. (New Society)