Companies that do business in China, or compete for ashare of the Chinese market's growth, should seriously considermaking the renminbi (RMB) an integral part of their cash managementstrategy. Use of RMB to settle transactions can not only improve acompany's leverage on prices with customers and suppliers, but canalso reduce financial risks the company faces, improve theeffectiveness of corporate investments, and deepen businessrelationships.

If these sound like bold claims, consider how far China hasopened itself to the world in a short time. The nation's rapidtrade growth has been pulled forward by the twin locomotives ofextraordinary domestic growth in China and increasinglytransnational industrial assembly lines. Although the nation'sGDP growth forecast this year is the lowest in 11 years, Chinacontinues to grow much faster than many other economies.

Meanwhile, the Chinese government has been loosening controls onthe renminbi to establish it as a global trade currency, aninvestment currency, and a reserve currency. In 2014, about 22percent of China's trade was settled in renminbi. HSBC expects thatshare to rise to more than 30 percent this year, and to 50 percentby 2020, as companies become increasingly aware of the potentialbenefits of invoicing and settling in the Chinese currency.