Enter the Dragon: Beijing Pushing Ahead With ‘Yuanization’ of World Economy…”any awkward movement in the market may trigger an all-out “financial war.”
SputnikNews.com
05.11.2015
While Washington continues to vex China over the South China Sea disputes, Beijing is pushing ahead with the yuanization of the world economy, Mexican economist Ariel Noyola Rodriguez notes.
Despite Washington’s displeasure, Beijing seeks to make the yuan (or ‘renminbi’) the world’s reserve currency.
“The renminbi is today the second most utilized currency for commercial financing, and the fourth most demanded for cross-border payments, according to data from the Society of World Interbank Financial Telecommunications (SWIFT),” Mexican economist Ariel Noyola Rodriguez elaborated in his article for RT.
The economist noted that Beijing is no bull in a china shop: the Communist Party of China knows perfectly well that it is being watched by the Federal Reserve and the US Treasury Department and any awkward movement in the market may trigger an all-out “financial war.”
China moves step by step, Rodriguez remarked, dubbing Beijing’s yuanization strategy as “gradualism.” Firstly, the Chinese government established ties with its Asian neighbors, by concluding swap agreements, installing Offshore Clearing Banks (OCB), as well as providing its partners with investment quotas in the Renminbi Qualified Foreign Institutional Investor Program (RQFII).
Secondly, China turned to Western Europe, in particular to the United Kingdom. The economist underscored that in 2013, Britain became the first country to popularize the renminbi in Europe.
“The City of London has more than half of operations denominated in yuan in the European continent,” the economist stressed.
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