China to let market decide future of yuan settlement
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China will let the market decide the future of yuan settlement in cross-border trade as it further removes obstacles at the administration level, a central bank vice governor said Tuesday.
"We support market rules," said Yi Gang, vice governor of the People's Bank of China, while answering questions concerning pilot yuan settlement in cross-border trade on the sidelines of the annual session of the National People's Congress (NPC), the country's supreme legislature.
"There used to be administrative obstacles, but now we are removing them and will let the market make its decision," said Yi, who is also director of the State Administration of Foreign Exchange, the country's foreign reserves regulator.
All parties involved in China's pilot yuan settlement in cross-border trade have showed enthusiasm over the trial programs, he said.
With the market-oriented policy, Yi expressed great optimism over the potential market demand and future development of yuan settlements.
Pilot yuan settlements in cross-border trade were launched in five Chinese cities in July last year, including the eastern economic hub Shanghai and four cities in south Guangdong Province, namely Guangzhou, Shenzhen, Zhuhai and Dongguan.
The country will further promote the use of the Chinese currency in cross-border trade and gradually develop overseas financial activities involving yuan, according to a government work report submitted to the NPC last Friday.
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