McDowell Comments on the Use of China’s Renminbi as a Global Currency in The Wire China
May 2, 2023
The Wire China
The Chinese renminbi is unlikely to supplant the dollar any time soon, but authorities in China are still interested in chipping away at its lead—particularly if it can help provide a buffer against the threat of American sanctions, both for China and its allies like Russia.
The Chinese government’s efforts to reduce its dollar dependence aren’t new. Policymakers at the People’s Bank of China, the country’s central bank, began exploring the strategy in the 2000s, intensifying their efforts after the 2008 global financial crisis.
“China had economic motives to de-dollarize that predate sanction concerns,” says Daniel McDowell, associate professor of political science. “When the U.S. economy had a financial crisis, China ended up getting hurt. China figured, we should probably promote our own currency now.”
Read more in The Wire China article, “The Renminbi’s New Role: Sanctions Busting.”
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