Global renminbi role not now in China’s interest

 Global renminbi role not now in China’s interest

The renminbi’s global financial and reserve role remains a hot topic of conversation. Some argue the currency is coming of age and that a digital renminbi will propel it forward. Others, including myself, believe the renminbi’s global role will remain quite modest for the foreseeable future. While Chinese authorities may find it beneficial to deprecate the dollar and the US role in the international monetary system, a major global role for the renminbi is not now in China’s interest.

It’s all about control. Chinese authorities want to maintain strict control over the economic and financial system, mainly to guard against potential instability. That only complements the trend towards increased political control over Chinese society under President Xi Jinping.

The dollar’s global status reflects the size and openness of the US economy, good legal protections for investors and the depth, robustness and liquidity of American…

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