Economist spotlights China's efforts for RMB inclusion in SDR

An advertisement poster promoting China's renminbi (RMB) or yuan , US dollar and Euro exchange services is seen outside at foreign exchange store in Hong Kong, China in this August 13, 2015 file photo. [Photo/Agencies]

Earlier in October, the first phase of the China international payment system was launched in Shanghai. On Oct 8, the central bank announced that China's official statistics will conform to special data dissemination standards (SDDS), an IMF statistical system to improve transparency.

In the short term, Zhu did not expect strong direct influence on global capital market even if the RMB is to be included in the SDR this month, while stressing the symbolic significance.

In the long run, RMB's internationalization is hinged on Chinese economic performance and the evolving of China's capital account and interest rate mechanisms, Zhu said.

"China will continue financial reform in the hope that the RMB will be included in the SDR basket later this year," said Yi Gang, deputy governor of the PBOC, at the IMF annual talks in Lima last month.

China has opened its inter-bank bond market and forex market to overseas financial institutions; has been promoting data transparency, following SDR requirements; and has freed the RMB exchange rate through changes to the central parity rate mechanism, Yi said.

The SDR is currently constituted by the dollar, euro, Japanese yen and the British pound. Chinese yuan failed to be included in the basket in 2010 as the IMF said the currency did not meet the freely usable criteria.