Chinese President Xi Jinping has called for the yuan to play a larger role as a global reserve currency, renewing Beijing’s long-standing push to elevate its currency in international trade, finance and central bank reserves.
Speaking at recent high-level economic and diplomatic forums, Xi said the global financial system should become more diverse, inclusive and resilient, arguing that excessive dependence on a single currency exposes countries to external shocks and political risk. He framed a stronger international role for the yuan as part of China’s vision for what it calls a “fairer international economic order.”
China has for years promoted the yuan’s use beyond its borders, particularly in trade settlement, cross-border lending and energy transactions. According to the People’s Bank of China, yuan-denominated trade settlements have expanded steadily, especially among countries participating in the Belt and Road Initiative and within groupings such as BRICS.
Despite that progress, the yuan remains a minor reserve currency by global standards. IMF data show it accounts for less than 3% of disclosed global foreign-exchange reserves, compared with nearly 60% for the U.S. dollar. Analysts say this reflects lingering concerns about China’s capital controls, market transparency and the independence of its financial institutions.
“China wants greater monetary influence to match its economic weight,” said Dr. Elaine Wu, a senior fellow in international economics at the Asia Financial Institute. “But reserve currency status depends on trust, liquidity and open markets — areas where Beijing still faces structural hurdles.”
The renewed push comes amid growing talk of de-dollarisation across parts of the Global South, driven by geopolitical tensions, sanctions on Russia, and volatility in global markets. Several countries have increased the use of local currencies in bilateral trade with China, while some central banks have added small amounts of yuan to their reserves.
Chinese officials argue that expanding the yuan’s role would not replace existing reserve currencies but complement them. Western policymakers, however, remain skeptical, noting that true reserve currencies require full convertibility and legal predictability — reforms Beijing has been cautious to embrace.
For now, Xi’s call signals ambition rather than imminent transformation. Whether the yuan can meaningfully challenge the dollar’s dominance will depend less on rhetoric and more on China’s willingness to open its financial system — a step that could redefine its economic relationship with the world.