2021 Fiscal Year Research-status Report
The international politics of currency internationalization
| Project/Area Number |
20K01498
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| Research Institution | National Graduate Institute for Policy Studies |
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Principal Investigator |
CHEY Hyoung・kyu 政策研究大学院大学, 政策研究科, 教授 (20626999)
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| Project Period (FY) |
2020-04-01 – 2023-03-31
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| Keywords | international currency / RMB internationalization / China / renminbi / yuan / international money / currency statecraft |
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| Outline of Annual Research Achievements |
The outcomes of my research on the international politics surrounding the internationalization of the Chinese renminbi have been published by Routledge as a book entitled "The International Political Economy of the Renminbi: Currency Internationalization and Reactive Currency Statecraft." Although the internationalization of the renminbi is an important international political event, most of the studies of it place their analytical focuses largely just on China itself, the issuer of the currency. In contrast, this book addresses the question of how foreign states have responded to the renminbi’s internationalization, during its initial phase through the 2010s, and thereby breaks new ground in exploring the international politics of currency internationalization. It builds a theoretical framework for analyzing a state’s policy toward renminbi internationalization, developing the key concept of reactive currency statecraft. It then applies this framework to the four select cases of the United Kingdom, Japan, South Korea and the United States.
Also, I have co-authored with a collaborator a book chapter entitled “Exit for Voice: Redrawing the Global Financial Map,” which will be published by Edward Elgar in a handbook on regionalism and global governance. This chapter addresses the development of the internationalization of the renminbi since the global financial crisis of 2008, along with that of regional financial arrangements.
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| Current Status of Research Progress |
Current Status of Research Progress
1: Research has progressed more than it was originally planned.
Reason
My research has progressed well and, as a result, I have completed a study of the international politics surrounding the Chinese renminbi’s internationalization. This study addresses the question of how foreign states have responded to the internationalization of the renminbi. It develops the concept that I call reactive currency statecraft, defined as a foreign state’s strategic policy toward an international currency, and builds a theoretical framework that analyzes it from the broad perspective of foreign policy, as well as international currency policy, with a focus on the case of the renminbi. It then applies this framework to explore how four particular states - the United Kingdom, Japan, South Korea and the United States - have reacted to the internationalization of the renminbi during its initial phase through the 2010s. The outcomes of this research have been published by Routledge as a book entitled "The International Political Economy of the Renminbi: Currency Internationalization and Reactive Currency Statecraft." I also have presented the research outcomes in the following four online conferences: the 2021 International Political Science Association World Congress, the World Congress for Korean Politics and Society 2021, the 2021 Korean Association of International Studies Annual Conference, and the GRIPS SISP/MSP Seminar. Moreover, I have coauthored a book chapter that examines the development of the renminbi’s internationalization. It will be published by Edward Elgar in its handbook on regionalism and global governance.
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| Strategy for Future Research Activity |
I plan to extend the scope of my research into some additional issues that are likely to have significant impacts on the future of the world monetary order and the international politics surrounding it. They include cryptocurrencies such as Bitcoin and central bank digital currencies. Cryptocurrencies have grown considerably in recent years, with their aggregate market capitalization reaching around two trillion dollars. In the meantime, the majority of central banks are currently exploring central bank digital currencies, while China has been already running pilot programs of the digital renminbi named e-CNY, with a large population. These new monetary developments raise salient political economy questions, including how they will affect the state’s capacity to manage its economy and whether they will challenge the current dollar-centered global monetary order, transforming the monetary map of the world. I plan to examine such political economy issues related to these new monetary developments. Given that the COVID-19 pandemic remains persistent at the moment, I may need to work with the data that I can obtain mainly domestically and online. However, if the pandemic comes to an end and travel restrictions are lifted in the future, I may take overseas research trips to some foreign countries such as China and South Korea for the collection of data on cryptocurrencies and central bank digital currencies in those countries.
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| Causes of Carryover |
Because of the COVID-19 pandemic I have had to alter my research plan. Initially, I planned to take domestic and overseas research trips and to participate in an overseas academic conference in person. However, in this pandemic situation travel restrictions have been imposed and, accordingly, I have been unable to take any research travels. As a result, while there were some alternative expenditures, part of my Kakenhi budget for FY2021 has not been used. My use of my Kakenhi for next fiscal year will be largely affected by how the pandemic goes. If the pandemic comes to an end and travel restrictions are lifted, I will be able to use my research funds for my overseas research activities. However, if the pandemic persists and travel restrictions remain, I will use my research funds for the costs that will arise due to changes in my research plan.
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