OUTSIDE China, Mao Zedong is out of fashion these days, remembered less as a revolutionary hero than as a tyrant. But the currency which sports his image on its banknotes is making headway abroad. In Hong Kong some cash machines dispense the “redback”, as the yuan or renminbi is known. In Mongolia 60% of cash in circulation is estimated to be Chinese. The yuan, whose internationalisation really began only in 2009, is now reckoned the seventh-most-used currency in the world, up from 13th a year ago. When China, the world’s biggest trading nation, becomes in the next few years its biggest economy too, many Chinese expect the currency to match its status, ready to challenge the dominance in the global monetary system enjoyed by the American dollar. They will probably be disappointed.Until 20 years ago, the yuan was so domestic that foreigners in China were supposed to use vouchers called “foreign-exchange certificates” instead. Now landmarks of the yuan’s advance appear every week. This month a long-stalled agreement linking the Hong Kong and Shanghai stock exchanges and allowing trading to be settled in yuan got a green light. Singapore, London and Frankfurt are...
from The Economist: China http://ift.tt/1jV33Sa
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