Money

Senior banker calls for more yuan settlements

(Xinhua)
Updated: 2011-03-09 11:00

BEIJING - China should expand the use of its currency, the yuan, in cross-border trade and investment amid its efforts to internationalize the yuan, a senior banker said Tuesday.

Cross-border trade and investment are developing rapidly which boosts overseas demand for the yuan, making it the right time to increase the yuan's status internationally, said Ma Weihua, president of China Merchants Bank.

Related readings:  Yuan settlement to be expanded in mainland  Yuan-based trade settlement volume increases  China to increases yuan-settlement companies  Cross-border yuan trade to boost liquidity

The yuan should be internationalized in an "active, steady and orderly" manner, he said, noting China will have to challenge the impact of cross-border capital flows and interest rates and exchange rates fluctuations amid the process, he said.

The trial program of yuan settlement in cross-border trade started in 2009 in five cities and then expanded to 20 cities last year.

The People's Bank of China, the central bank, said last Wednesday that it would expand the trial program to the entire country this year.

Premier Wen Jiabao said Saturday in his government work report for 2011 that China would continue to increase the use of its currency in cross-border trade and investment this year and press ahead with making the currency convertible under capital accounts.