China Everbright Group chairman Tang Shuangning expected the international monetary system to diversify as other currencies would challenge the currently dominant dollar after the US economy was dragged into recession by the financial crisis.
The financial crisis had exposed flaws of the current U.S. dollar-based global reserve system, and thus needed overhaul, he told Xinhua Thursday.
The emerging economies, such as Brazil, Russia, India and China, are voicing their demand for higher status of their own currencies as the recent rapid economic growth have lifted their international positions, he added.
He expected the international monetary system would first have dollar as dominant and other currencies as subsidiary after the crisis and finally have a global currency, or a super-sovereign reserve currency.
The super-sovereign reserve currency would be issued and managed under regulations jointly made by countries, which would reduce risks of currency crisis and financial crisis, he said.
He made the comment after Chinese government reiterated the proposal to create an international reserve currency that would be disconnected from individual nations, which would be able to remain stable in the long run.
Chinese President Hu Jintao left Beijing for London Wednesday morning to attend the G20 summit in London and he urged what he called "necessary reforms" of the international financial system.
Tang also mapped a track for the development of the Chinese currency, yuan, which would go from peripheral to regional and global, or settlement currency to investment currency to reserve currency. He said the country had to strengthen its power, improve its financial market and realize currency convertibility to go along the route.
(Xinhua News Agency April 2, 2009)
