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Is the Chinese Currency on the Way to the World Currency Status?
[Je čínská měna na cestě k pozici světové měny?]

Author

Listed:
  • Martina Jiránková

Abstract

The article deals with the aspiration of the Chinese currency to become the world currency status. The world currency must perform as a store of value, means of exchange, and an accounting unit internationally for governments as well as the private sector. The important conditions of this position are an important share in the world's GDP and the global trade, stability of the domestic economy, and financial markets of high quality and depth. The last one is the most problematic of the given assumptions. Because of it, China has started a reform of its financial sector, and this reform has been accelerated since 2012. The convertibility of the Chinese currency is planned in several stages: gradually from its use in international trade, to international investments, and finally in international reserves. So far, payments for trade transactions have been fully liberalised. As for financial transactions, obstacles are gradually reduced. The internationalisation of the Chinese currency is taking place in the wider context of the world economy, which the text also discusses.

Suggested Citation

  • Martina Jiránková, 2014. "Is the Chinese Currency on the Way to the World Currency Status? [Je čínská měna na cestě k pozici světové měny?]," Acta Oeconomica Pragensia, Prague University of Economics and Business, vol. 2014(3), pages 3-16.
    • Handle: RePEc:prg:jnlaop:v:2014:y:2014:i:3:id:440:p:3-16
    DOI: 10.18267/j.aop.440
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    References listed on IDEAS

    as
    1. Fang, Ying & Huang, Shicheng & Niu, Linlin, 2012. "De facto currency baskets of China and East Asian economies: The rising weights," BOFIT Discussion Papers 2/2012, Bank of Finland Institute for Emerging Economies (BOFIT).
    2. Fang, Ying & Huang, Shicheng & Niu, Linlin, 2012. "De facto currency baskets of China and East Asian economies : The rising weights," BOFIT Discussion Papers 2/2012, Bank of Finland, Institute for Economies in Transition.
    3. Eichengreen, Barry, 2012. "Exorbitant Privilege: The Rise and Fall of the Dollar," OUP Catalogue, Oxford University Press, number 9780199642472.
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    JEL classification:

    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • F31 - International Economics - - International Finance - - - Foreign Exchange

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