China International Economic Exchange Center Vice President Huang Qihang
China People’s University Prof. Zhao Xin
Former Secretary of Defense Carter
China: Digital RMB concept: strengthening China, weakening the US
China International Economic Exchange Center: Vice President Huang Qiho
In October 2019, a speech by an executive from China’s International Economic Exchange Center (Government Think Tank) in China received a great deal of attention.
That’s why the Digital RMB concept was mentioned.
Vice President Huang Qifan stated that the People’s Bank of China will be the first central bank to issue digital currencies in the world.
People’s Bank of China: Digital Currency Research Team
In 2014, the People’s Bank of China formed a digital currency research team.
In 2017, the Digital Monetary Research Institute was established and steadily preparing for it.
Digital RMB: issued by Central Bank
The digital renminbi is very different from the private digital currency.
Central bank issues digital RMB.
This means that anyone can use it anywhere, without using a bank account.
Traditional electronic money is issued by the private sector.
Therefore, the companies that provide the services and the affiliated stores are limited.
Digital yuan: the value of currency
There is also a big difference in the value of currency.
The value of private digital currencies fluctuates speculatively.
To address this, Libra has stated that the issuance will be backed by multiple currencies and government bonds.
Digital RMB is the same legal currency as RMB currently in circulation.
In other words, it is believed that the value is stable because the government’s trust is backed.
Digital RMB: China’s Leading Edge
There are two reasons why China’s digital currency is leading other countries.
Cashless society:
The first is the penetration of a cashless society.
Smartphone payments are widespread in China, with more than 600 million users.
Blockchain technology:
Another reason is that “leading with blockchain technology supporting digital RMB”.
This technology records data simultaneously on multiple computers on the Internet and shares information.
Because it is difficult to falsify, it is highly secure and can be managed at low cost.
There are more than 27,000 blockchain technology-related companies in China, and the world’s number of patent applications for the second consecutive year.
Digital RMB Aim (1): Convenience of Payment and Crime Control
What is the aim of the Chinese government to introduce the digital RMB?
Prof. Zhao Xun, a professor at People’s University of China, who is familiar with China’s financial issues, will address crime prevention in addition to improving payment convenience.
Digital RMB Aim (2): Criticism of “SWIFT”
In the international settlement “SWIFT”, if you use dollars, you need to “go through the US bank for Chinese and Japanese transactions.”
In other words, it means that “all financial transactions go to the United States.”
In addition, “SWIFT” has “criticism that it takes time and costs are high“.
With digital currencies, you can “send money to the world at low cost and in a short time.”
US: Security Threat: Dollar Sanctions Failing
Until now, the United States has set the “economic sanctions against hostile nations and terrorist support organizations” as “the trump card against using the dollar.”
However, as more countries use the RMB instead of the dollar, the effects of dollar sanctions will diminish.
United States: Former Secretary of Defense Carter
“The digital RMB strengthens China’s economic power and weakens the United States,” he said.
NHK News
https://www3.nhk.or.jp/news/html/20191225/k10012227701000.html?utm_int=all_side_business-ranking_005