• Caught in the debt trap?

    Help us help you by taking our second annual Debt survey and you could win R3 000.

  • Rich man, poor man

    Culture change from below is the only way to overcome poverty, says Leopold Scholtz.

  • Tech bubble talk

    After the tech euphoria of 2013, the fast-moving sector has hit a speed bump.

Data provided by McGregor BFA
All data is delayed
See More

China urges IMF to embrace currencies

May 05 2011 08:10 Reuters

Related Articles

China rate hike fears weigh on stocks

Brics to receive 10bn yuan in loans

Stocks down, focus on interest rates

China's foreign reserves soar

Brics eye global monetary reform

Brics won't talk about yuan - China

Shanghai - The IMF should consider including currencies of the Brics countries and other emerging economies when it next reviews its Special Drawing Right (SDR) system by 2015, the head of China's foreign exchange authority said in remarks published on Thursday.

Yi Gang, who is also a deputy governor of the People's Bank of China (PBOC), called on the International Monetary Fund to kick off a research of a "shadow SDR" this year, the semi-official China Business News reported.

The IMF should then be able to accumulate enough data to consider whether currencies of major emerging economies, such as those of the Brics countries, could be added to the SDR basket by 2015, the newspaper quoted Yi as saying in a lecture at Peking University this week.

"We propose to the IMF to adjust its SDR currency basket by 2015 at the latest when it reviews the basket next time," Yi, head of the State Administration of Foreign Exchange, was quoted as saying.

The SDR, the IMF's internal accounting unit and reserve asset, comprises the US dollar, British pound, euro and Japanese yen. Chinese officials have asserted that widening the basket to include currencies such as China's yuan, would heighten its profile as a potential reserve currency.

Calls by Chinese officials for inclusion of the yuan in particular to the SDR are not new. In March 2009, PBOC governor Zhou Xiaochuan first sketched out China's long-term ambition to supplant the dollar with a super-sovereign currency akin to the IMF's SDR and implied that the yuan could be one of its constituents.

Some commentators have called Zhou's vision naive, partly because the yuan is not freely convertible nor is its value determined solely by markets since Beijing manages it closely.

But with emerging markets projected to post stronger growth while developed countries struggle with mounting debts, the political clout of the Brics countries has increased.

Meeting in the southern Chinese island of Hainan last month, leaders of the BRICS countries - Brazil, Russia, India, China and South Africa - called for a revamped global monetary system that relies less on the dollar.

Yi, whose comments appear to elaborate on Zhou's initial proposal, said that China is patient.

"China is in no hurry as the SDR has so far been only a symbolic currency basket," Yi was quoted as saying.

"Still, the SDR is a symbolic arrangement of international currency system, and only widely used currencies of the world's most powerful trade nations should be included," he said.

Yi named currencies of Saudi Arabia, South Korea and Australia among other nations that have the potential to be included in the SDR, the China Business News reported
china  |  currencies  |  imf


Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Add your comment
Comment 0 characters remaining

Company Snapshot

We're Talking About: Small Business

Standard Bank is looking for 12 entrepreneurs to participate in a 10-part TV series. They could win a R1m investment into their dream.

Nkandla: Zuma 'still looking for undue benefit'

President Jacob Zuma has told supporters at an election rally in Mpumalanga that he had not wrongfully benefited from the upgrade to his Nkandla home.


Latest elections multimedia

Watch what happened when we blindfolded Helen Zille and asked her to eat random things
13 days to elections - news you need to know
11 Julius Malema quotes you'll never forget
DA won't get 30% - Zille

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...