Five Years Anniversary Since Renminbi was Included in the SDR Basket: Results and Prospects

DOI: 10.20542/0131-2227-2021-65-6-59-70
A. Polivach (,
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow, 117997, Russian Federation

Received 29.01.2021.

Abstract. The renminbi was included in the SDR basket from October 2016. In that time there were a lot of doubts about whether the renminbi was enough freely used currency to comply with the criteria of such inclusion. Other opinions focused on possibility that this inclusion would boost international usage of the renminbi. The author analyses statistics and comes to conclusion that the maximum boost of the renminbi usage was achieved right before the inclusion. The China’s statistics shows the boost of renminbi usage in the external transactions in 2016–2020, but statistics of its trading partners and SWIFT reveal only moderate growth or even stagnation in this period. One of explanation of this discrepancy may be that despite Chinese banks’ substantially increased external lending in renminbi in recent years, it looks that banks actually do not transfer renminbi abroad to borrowers. Banks just remit these sums to Chinese suppliers under the instructions by foreign borrowers. Then those borrowers repay those renminbi loans most likely in dollars. So China’s statistics record boost of renminbi usage, but its trading partners do not see those renminbi. The key obstacle for widening international usage of renminbi is remaining restrictions (formal and informal) for transactions under the financial account of China’s balance of payments. The author considers prospects of increasing the international role of the renminbi and comes to conclusion that it is likely that China is afraid of liberalisation of its financial accounts because there is a risk of long-term depreciation of the renminbi. Contrary to widely popular belief that China stands for and practiced with undervalued exchange rate of the renminbi the author statistically shows that in the past 25 years the renminbi was stronger than the G7’s currencies and substantially stronger than the currencies of China’s neighbour competitors. It looks that devaluation-averse sentiments hinder China’s decision makers from introduction of real liberalisation of its financial account, because free transborder movements of capital may create sharp depreciating impact on the renminbi and thus undermine Chinese economic achievements of last decades. That’s why it is unlikely that the renminbi will substantially increase its international role in the foreseeable future.

Keywords: internationalisation of renminbi, official currency reserves, global payment currency, transborder movements of capital


1. Currency Composition of Official Foreign Exchange Reserves (COFER). IMF. Available at: (accessed 21.01.2021).

2. Eichengreen B., Chiţu L., Mehl A. Stability or Upheaval? The Currency Composition of International Reserves in the Long Run. European Central Bank. Working Paper Series, no. 1715. August 2014. Available at: (accessed 15.10.2020).

3. Direction of Trade Statistics Dataset (DOTS). IMF. Available at: (accessed 25.01.2021).

4. Time-series Data of Cross-border Receipts and Payments by Non-banking Sectors. State Administration of Foreign Exchange (China). Available at: (accessed 22.01.2021).

5. Currency composition of settlements for goods and services supplied by foreign trade contracts (in per cent to total). Bank of Russia (In Russ.) Available at: (accessed 25.01.2021).

6. Currency of Invoices for UK Trade with Countries outside the EU. HM Revenue & Customs. Available at: (accessed 15.01.2021).

7. International Trade in Goods. Eurostat Database. Available at: (accessed 05.01.2021).

8. RMB Trackers. SWIFT. Available at: (accessed 12.01.2021).

9. RMB Tracker, December 2020. SWIFT. Available at: (accessed 12.01.2021).

10. CIPS Co. Ltd. Available at: (accessed 18.01.2021).

11. Triennial Central Bank Surveys. Bank for International Settlements. Available at: (accessed 25.12.2020).

12. Polivach A.P. Renminbi and Ruble in economies of countries of the Central Asia. Russia and the New States of Eurasia, 2020, no. IV (XLIX), pp. 87-102. (In Russ.) DOI: 10.20542/2073-4786-2020-4-87-102

13. Ruble, Renminbi or US Dollar: which one should be used for payment to Chinese partners (In Russ.) Available at: (accessed 25.12.2020).

14. Objective of the Monetary Policy. The People’s Bank of China. Available at: (accessed 20.01.2021).

15. International Financial Statistics Dataset (IFS). IMF. Available at: (accessed 20.01.2021).

16. Effective Exchange Rate Indices. Bank for International Settlements. Available at: (accessed 20.01.2021).

17. Katsuji Nakazawa. China Talks of US Decoupling and a Divided World. NIKKEI Asian Review, 09.07.2020. Available at: (accessed 09.07.2020).

Registered in System SCIENCE INDEX

For citation:
Polivach A. Five Years Anniversary Since Renminbi was Included in the SDR Basket: Results and Prospects. World Eonomy and International Relations, 2021, vol. 65, no. 6, pp. 59-70.

Comments (0)

No comments

Add comment






Dear authors! Please note that in the VAK List of peer-reviewed scientific journals, in which the main scientific results of dissertations for the degree of candidate and doctor of sciences should be published for the “MEMO Journal” the following specialties are recorded:
economic sciences:
5.2.5. World Economy.
5.2.1. Economic Theory
5.2.3. Regional and Branch Economics
political sciences:
5.5.4. International Relations
5.5.1. History and Theory of Politics
5.5.2. Political Institutions, Processes, Technologies


Current Issue
2024, vol. 68, No. 2

Topical Themes of the Issue:

  • Fiscal Policy of Advanced Economies: Playing by the Rules?  
  • Iranian Development Model: State and Society Concept, Crises and Problems
  • Afghan-Pakistan Relations: Problems and Challenges in XXI Century
  • Climate Issues under Changing Geopolitical Conditions
Submit an Article
The Editorial Board invites authors to write analytical articles on the following topics:
  • changes in the processes of globalization in modern conditions
  • formation of the new world order
  • shifts in civilization at the stage of transition to a digital society

The editors are also interested in publishing synthesis articles / scientific reviews revealing the main trends in the development of certain regions of the world - Latin America, Africa, South Asia, etc.