"Countries along the Belt and Road Initiative (BRI) usually use RMB for settlement, and the great progress made by BRI has expanded the settlement space for the RMB," Tan Yaling, president of China Foreign Investment Research Institute (CFIRI), was quoted as saying by a Chinese media outlet.
China's economic scale exceeded 114 trillion yuan ($18 trillion) and its foreign trade increased by over 20 per cent in 2021. Tan believed well-developed foreign trade has greatly contributed to the rankings promotion of the RMB for global payments.
She added that rankings promotion of the RMB shows China's economic reform and financial opening has been widely recognised, and the reliability and credibility of RMB have improved.
RMB appreciation attracts more countries to use the currency for settlement when the currencies of major developed countries see less stability, the expert noted.
Tan feels RMB appreciation is not beneficial for China's trade. Along with the rising price of raw materials, sea transportation and labour costs, Chinese foreign trade enterprises are getting less and less profits so they are facing challenges this year.
ALCHEMPro News Desk (DS)
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