• University of New South Wales
  • Macquarie University
  • The University of Sydney
  • University of Technology Sydney
  • Australian National University
  • The University of Melbourne
  • Capital Markets
  • Sirca
  • Commonwealth Bank
  • KPMG
  • King & Wood Mallesons
  • Macquarie
  • Australian Government - Treasury
  • New South Wales Goverment

CIFR Research Project

RMB invoicing & RMB internationalisation: opportunities & challenges for Australia - RMB
Assessment Round: June 2013  Completion Date: 2014
Project Summary

The study explores possible ways of encouraging greater RMB trade invoicing and, more broadly, a range of market and policy questions related to the development of RMB trade and investment flows between Australia and China. The study includes both international and Australian aspects, with inputs from academics, industry, the Reserve Bank of Australia (RBA), the Treasury and CIFR. Oversight was provided by a steering committee comprising representatives from CIFR, Treasury, the RBA and the financial industry.


The study delivered a number of key insights and recommendations, including:

•    China is now the largest source of global savings and is becoming a core part of diversified global investment portfolios.  Because Australia needs access to foreign capital to fund its ongoing investment needs, there is an opportunity for Australia and China to forge deeper and broader financial links.  This will require the right policy settings and a good deal of strategic thinking and planning.  This study suggests that much of the policy framework is already in place, however a number of policy and market issues need to be addressed if Australia is to fully benefit from China’s financial development.

•    As China and its institutions and markets continue to grow, we can expect its currency and capital markets to become as important as its economy and global trade links.  These ongoing developments in China will require adaptation and change around the world: to trade patterns and how they are financed and settled, to portfolio investment flows, and to international financial institutions and their practices.
•    There are a number of factors inhibiting greater RMB trade invoicing between Australia and China.  Some of these have predominantly Chinese origins, including: banks discouraging customers from invoicing in RMB; concerns about identifying transactions as being genuinely trade-related and hence not subject to VAT; and lack of awareness by many smaller Chinese companies that RMB invoicing is possible.  In both countries, increasing corporate awareness of the potential benefits of RMB invoicing and settlement and the range of hedging and risk management products available would be beneficial.  There is still considerable market uncertainty regarding the tax treatment of cross-border financial transactions, in particular with respect to offshore investors investing through Australian-domiciled investment vehicles.  This needs to be addressed by establishing an effective and wide-ranging Investment Manager Regime.

•    Ongoing developments in offshore RMB settlement arrangements should be watched closely to ensure that Australian settlement arrangements are as easy and effective as those in other major financial centres.

•    There is a lack of awareness on the part of many funds management executives of the rapid pace of change in China’s financial markets and the associated need to start thinking strategically about how to position their businesses to benefit from the opening up of China’s capital markets.

•    Perceptions in China of Australian discrimination against Chinese investment and antipathy in some quarters towards Chinese investment in Australia need to be overcome.


CIFR Workshop: People's Bank of China Delegation, Sydney ( November 2013) CIFR Report Launch: Internationalisation of the RMB, Sydney (March 2014) CIFR Forum : Internationalisation of the RMB, Sydney (November 2013)


Team Leader:
Mr Geoff Weir | , Independent
Professor Barry Eichengreen | George C. Pardee and Helen N. Pardee Professor of Economics and Political Science, Department of Economics, University of California, Berkeley
Associate Professor Kathy Walsh | Research Fellow, Finance, Actuarial Studies & Applied Statistics, College of Business and Economics, Australian National University
Project Outputs:


The Centre for International Finance and Regulation (CIFR) represents a strategic link between academia, financial regulators, policy makers and industry, promoting financial sector vibrancy, resiliency and integrity, through leading research and education.

CIFR receives funding and support from the Commonwealth and NSW Governments, and its industry, university and research centre partners.



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