China moves to 'globalise' yuan

09-01-2009 • dnaindia

Hong Kong: China has signalled a seriousness of intent in 'internationalising' the yuan by appointing a high-profile task force to draw out a roadmap to that ambitious goal, which some economists believe will be realised sooner than most believe. "The latest indications suggest Chinese policy makers are very serious about the plan to internationalise the local currency," says HSBC economist Qu Hongbin. He sees two underlying reasons for this: one, Chinese leaders see internationalising the yuan as "the best solution to free themselves from a dollar trap"; and second, as the third largest economy and now the world's largest exporter, "it doesn't make sense for China to use the US dollar to settle more than 70% of cross-border trade." Vice-premier Wang Qishan, who is in charge of foreign trade and finance, has been appointed to additionally head a taskforce to oversee the moves to make the renminbi the currency of choice for trade settl