China’s campaign to ‘internationalize’ its currency involves promoting the use of the RMB for international exchange. The goal is to eventually develop the RMB into a world-class currency on par with the Euro, the Japanese Yen, and the US Dollar. The roadmap comprises three broad milestones: (1) expanding the RMB’s use in global trade finance, (2) expanding the RMB’s use in global investment, and (3) establishing the RMB’s use as a global reserve currency. China has made progress in each of these categories but still has a long way to go.
Following the August 2015 RMB “surprise” devaluation and subsequent depreciation, progress has reversed, and the RMB’s use in the SWIFT network has tumbled to below two percent.