Yuan's Internationalisation: Insights from Huang Qifan
Understanding the Yuan's Global Standing
The internationalisation of the yuan is crucial for ensuring stability in the global supply chain. Huang Qifan shared insights on this at the Bund Summit in Shanghai, stating the increasing use of the yuan is inevitable as China’s economy continues to open.
Reaching for Greater Economic Heft
- The yuan’s global share in payments is projected to rise by 1 percentage point annually over the next decade.
- Despite recent gains, the yuan's current internationalisation index of 3.26 significantly trails behind the US dollar's 57.68.
Promoting Financial Power: A Balanced Approach
President Xi Jinping aspires to elevate China as a financial power. However, Huang cautioned against unrealistic ambitions to replace the US dollar. Instead, he noted China’s focus on maintaining the stability of the global industrial chain.
- Enhancing the yuan's use in cross-border transactions should be a priority.
- China aims for the yuan to account for 17% of global payments by 2035.
With plans to expand offshore yuan markets in financial hubs like Hong Kong and Singapore, the path towards full capital account convertibility remains tied to the yuan's international status.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.