China’s yuan will be more actively used in cross-border trades and 8 percent of the country’s foreign trade may be settled in yuan this year, Zhang Guangping, vice head of the Shanghai branch of the China Banking Regulatory Commission said Wednesday.
In the first quarter, 6.84 percent of foreign trade was settled in yuan, he said.
Zhang said the yuan is currently used more widely in imports than exports as foreign trading partners are willing to accept the currency when the yuan is appreciating.
China has stepped up efforts to promote the yuan’s use in cross-border trade and finance to reduce its reliance on the US dollar in the wake of the global financial crisis.
The increased circulation of yuan offshore is also key to China’s efforts to internationalise its currency.
Though the volume of yuan-denominated trade remains low, it is growing rapidly. Most yuan-based trade deals so far have involved Chinese companies using the Chinese currency to buy goods. Around 89 percent of yuan trade in the first quarter was accounted for by China’s imports, according to data from the People’s Bank of China.