It may take another 15 years before the yuan becomes a truly global currency as China needs to loosen restrictions on capital accounts and unify exchange rates for both on- and offshore markets, experts told the Lujiazui Forum yesterday.
"The internationalization of the yuan is a gradually developing and maturing process," said Li Lihui, chairman of the Bank of China. "We expect it to take 15 years for the yuan to become one of the world's major settlement and reserve currencies."
True globalization of the yuan will come after five stages - lifting the proportion of yuan trade-settlement in China's foreign trade, lifting the proportion of yuan payments in the global clearing system, expanding cross-border investment in yuan, becoming the reserve currency in Asia, and expanding the offshore yuan market.
Qin Xiao, chairman of Boyuan Foundation, a Hong Kong-registered think tank, agreed and said China needs to complete exchange rate reforms in three to five years.
Li Jiping, vice president of China Development Bank, said uncertain global economic conditions provide China with an ideal window to expand the use of yuan around the world.
He said China should encourage more domestic companies to invest in projects overseas in an effort to promote the role of yuan in international fundraising and investment.