China must seize every opportunity to strengthen the financial transaction function of renminbi, a recent report urges.

The renminbi Internationalization Report 2017, written by the International Monetary Institute at Renmin University of China, said the country must maximize the dividends of the renminbi joining the Special Drawing Rights, deepen domestic financial reform and strive to improve the international financial pricing and transaction functions of the currency.

The annual report was presented during the 2017 International Monetary Forum, held July 15-16 in Beijing.

University Vice-President Wu Xiaoqiu said that China's financial market is becoming more and more internationalized and its influence globally is increasing.

"With the internationalization of renminbi and the opening up of China's financial system, China will be not far from becoming a global financial center," he said.

The report found that the financial market provides logistics support for foreign trade and capital export. renminbi internationalization needs a mature international financial center. A complete international financial market for pricing and trading renminbi could be established using a short-term money market, medium-term bond market, and long-term multi-level equity market.

Moreover, overseas direct investment, which can expand the use of renminbi in many ways and play an efficient leveraging role, could become an important facilitator of its internationalization. As multinational corporations dominate international trade, expanding direct investment would consolidate China's trade position and provide markets and impetus for domestic-funded financial institutions to go global and develop offshore renminbi business, the report said.

The report also noted that actively promoting the development of the international renminbi bond market is an important way to build a smooth renminbi circulation mechanism and further deepen the process of internationalization.

Therefore, China should vigorously build and develop the renminbi bond market in order to improve the proportion of the currency in the international bond market. The renminbi bond market will become China's main channel to provide safe assets for the world, the report said.