China Backs Global Push for Yuan

China plans to expand the yuan’s global role, aiming to cut dependence on the U.S. dollar.

PBOC Governor Pan announced that China is intensifying efforts to make the yuan a widely used global currency. This initiative is part of Beijing’s broader strategy to lessen reliance on the U.S. dollar and increase its presence in international trade and financial markets. By promoting the yuan's international use, China hopes to boost its economic influence worldwide.

China’s yuan has the potential to rival the U.S. dollar as a global currency, but only if it becomes more accessible and convertible, says economist Hoe Ee Khor from the Asean+3 Macroeconomic Research Office. Khor believes the era of U.S. financial dominance is fading, and that the yuan—already used in cross-border payments—could step in, provided China opens its markets to foreign investors.

He points to China's bond and stock market “connect” schemes with Hong Kong as a promising model, but stresses that broader access and freely tradable yuan-backed assets are still needed. Without these changes, global adoption of the yuan remains limited.

Khor also referenced Asia’s $240 billion Chiang Mai Initiative, a financial safety net that could reduce regional dependence on the dollar in times of crisis. While unused so far, it reflects growing economic independence in Asia.

Despite U.S. tariffs and global disruptions, Khor suggests East Asia will adapt, increasingly trading within the region and building stronger ties beyond American influence.