Yuan needs to play bigger role in Central Asia: Chinese banker

June 14th, 2011 - 5:37 pm ICT by IANS  

Beijing, June 14 (IANS) The Chinese currency yuan needs to play a bigger role than the US dollar in trade deals in Central Asia in order to boost regional business, a top Chinese banker has said.

The Export-Import Bank of China - a major policy bank of the country - has already started providing yuan-denominated loans to banks in neighbouring countries, said Li Ruogu, the bank’s president and chairman.

China has approved a pilot programme in the northwestern Xinjiang Uygur region for trade with Central Asian countries to be settled in the Chinese currency, China Daily reported.

Fifteen banks in China have been certified to handle cross-border yuan services, while 20 foreign financial institutions can do the same.

“China should continue to push the internationalisation of the yuan,” he said.

“The yuan should play a bigger role than the US dollar in the region. The use of the yuan in trade settlement will help boost regional trade relations,” Li said.

But analysts said there were many difficulties in using yuan in trade with Central Asian countries. The major exports of those countries are energy-related products such as oil and gas which are generally settled in US dollars in the global market.

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