By Admin 
Chinese President Xi Jinping has given a big challenge to the US dollar in the international economy. He has said that China should make its currency Yuan so strong that the countries of the world can use and deposit it as an international reserve currency. At present the share of dollar in global foreign exchange reserves is around 58-60%. Xi Jinping has said this in an article published in ‘Qiushi’, the main theoretical journal of the Communist Party.
Effort to make Yuan a global reserve currency
This statement is very important because China is the second largest economy in the world. Xi Jinping clearly said that the yuan should be used extensively in international trade, investment and foreign exchange market. With this, Yuan will get the status of global reserve currency. Although he did not take the name of the dollar directly, his indication is clear that China wants to reduce its dependence on the US dollar.
Last year, one-third of China’s total foreign trade of US$6.2 trillion was settled in the local currency i.e. Yuan. China, together with Russia, has created a payment system called Cross-Border Interbank Payment System (CIPS), which is an alternative to SWIFT. The use of Yuan is increasing while purchasing oil and gas from Russia. China has made currency swap agreements with about 50 countries. There is talk of common currency and BRICS Pay system in BRICS countries.
China’s capital market is big but not strong
Chinese President Jinping said that China’s banking assets, foreign exchange reserves and capital markets are very large, but right now it is ‘big but not strong’. It will take time to become a strong financial powerhouse. For this, strong currency, central bank, financial institution, international centre, good monitoring and talent are needed. China’s own financial development model will be different from the Western model and will be based on strong economic foundations.
In the last one year, the yuan has strengthened against the dollar. Despite US President Donald Trump’s tariff policies, China created a record trade surplus in 2025 and kept its economy stable. This step could lead to a multilateral currency system in the global economy, where apart from the dollar, the role of currencies like the yuan will increase.