Timeline: the yuan’s journey to being a truly global currency
The yuan was a purely domestic currency until 2003, when the authorities began to loosen restrictions controlling its use. It is now scheduled to be fully convertible by 2020
2003, November: State Council gives the green light for banks in Hong Kong to provide yuan deposit, remittance, exchange and credit card services. Hong Kong Monetary Authority (HKMA) and People’s Bank of China (PBOC) sign a regulatory agreement capping the amount Hong Kong residents can exchange and remit at 20,000 yuan and 80,000 yuan per day, respectively.
2004, February: Banks launch their personal yuan business.
2009, June: HKMA and PBOC sign agreement to allow trade between Hong Kong and the mainland to be settled in yuan from July in five cities.
2010, June: Cross-border yuan trade settlement scheme is expanded to 20 provinces and cities.
2010, July: Beijing allows yuan transfers among financial firms and individuals to enable them to offer funds, insurance and other investment products denominated in yuan. First yuan-denominated corporate bond is issued in Hong Kong by Hopewell Highway Infrastructure, raising 1 billion yuan.
2010, August: PBOC allows yuan clearing banks and other overseas eligible financial institutions to trade directly in the mainland interbank market.
2010, December: Beijing expands the list of eligible mainland firms to conduct cross-border yuan trade settlement.
2011, January: PBOC announces pilot scheme for mainland companies to settle overseas direct investments in yuan.
2011, April: First yuan-denominated IPO in Hong Kong with the listing of Hui Xian Real Estate Investment Trust, a spin-off of Li Ka-shing’s Beijing Oriental Plaza.
2011, June: HKEX introduces guideline for dual-currency IPO model for candidates to sell shares denominated in both yuan and HK dollars – but no such IPO is launched yet.
2011, August: Beijing allows overseas firms to use yuan to settle foreign direct investments (FDI) in China, instead of the US dollar.
2011, December: Launch of renminbi qualified foreign institutional investor scheme (RQFII).
2012, January: Hong Kong signs agreement with City of London to help the English capital develop as the next offshore yuan trading centre. HKMA extends yuan trading hours, including yuan sovereign bonds and mainland interbank bonds as banks’ yuan risk management limits positions.
2012, June: China starts direct trading between the yuan and the Japanese yen in Tokyo and Shanghai. The National Development and Reform Commission identifies Qianhai as a testing ground for freer convertibility of the yuan. HKMA launches facility to provide yuan liquidity to banks engaged in yuan business in Hong Kong.
2012, July: Hong Kong banks are allowed to offer yuan services to non-residents.
2012, October: SFC approves the first dual-currency exchange-traded fund, Harvest MSCI China A Index ETF. Hopewell Highway Infrastructure announces the first yuan shares placement in the city, becoming the first listed company to offer both yuan and Hong Kong dollar-denominated stock.
2013, January: PBOC appoints Bank of China’s Taipei branch as yuan clearing bank for Taiwan. First cross-border yuan loans authorised with 15 banks in Hong Kong permitted to offer a combined 2 billion yuan in loans to companies in Qianhai.
2013, February: Beijing names Industrial and Commercial Bank of China (ICBC) as clearing bank for offshore yuan business in Singapore.
2013, April: Australia starts direct trading between the yuan and the Australian dollar. HKMA removes the yuan net open position limit for Hong Kong banks and lifts the 25 per cent minimum liquidity ratio for yuan.
2013, June: PBOC and Bank of England agree to a three-year currency swap line of up to 200 billion yuan. Hong Kong launches the world’s first offshore yuan interbank rate fixing.
2013, September: Shanghai becomes a free-trade zone, enjoying freer convertibility of yuan.
2014, November: Removal of the daily RMB exchange cap of 20,000 yuan a day ahead of the launch of the stock connect scheme to link the stock markets of Hong Kong and Shanghai and allow retail investors to conduct cross-border trading in yuan.
2015, July: Launch of the mutual recognition scheme to allow certain mutual funds in Hong Kong and mutual funds in China to cross-sell in each other’s market up to a total of 600 billion yuan.
2015, August: PBOC makes a one-off devaluation of the yuan by 2 per cent and changes the method for setting the mid-price range according to the previous market price at close of trading.
2015, October: PBOC launches the first phase of the China International Payment System (CIPS) and allows certain foreign banks to trade in the mainland bond market.
2015, November: State Council states goal of making the onshore yuan a freely tradeable currency by 2020.
2015, December: IMF decides to include the yuan in its Special Drawing Rights, giving it the status of a reserve currency like the US, euro, pound and yen.
2016, December: Launch of Hong Kong and Shenzhen stock connect scheme to allow cross-border trading.
2017, July: Launch of north-bound trading bond connect scheme.
2018: Expected launch of ETF connect in the second half of the year.