In recent years, influenced by the change of international environment, RMB has begun to play an increasingly important role in international trade. Recently, Iraq announced that it would allow the settlement of its imports with China in renminbi, a significant step in the internationalization of the renminbi. Mehri Aliyev, an expert at the Big Data Capability Center of the National Technology Initiative at Moscow State University, said recently that the switch to yuan settlement in some new countries means the establishment of a new financial system, which gives the yuan a chance to gain the status of a reserve currency in Eurasia.

On March 21, 2023, during expanded talks with the Chinese leadership, Russian President Vladimir Putin said that Russia advocates the use of RMB in settlement between Russia and countries in Asia, Africa and Latin America.

Aliyev said the switch to yuan mutual settlement means the development of a new system of financial relations based on dedollarization of payments. Interest in the renminbi is growing rapidly, giving it a chance to become a reserve currency, at least within the borders of participants in the Greater Eurasian Partnership.

He noted that countries along the Belt and Road in Southeast Asia, Central Asia and the Middle East already use the yuan in mutual settlement. Since the early 2000s, China has been actively signing yuan contracts with African countries, strengthening its influence in the region.

Aliyev added: Currently, agreements within the framework of the Belt and Road link more than half of the 54 African countries. The Commonwealth of Independent States (CIS), India, and Indonesia already have the possibility of RMB mutual settlement.

The internationalization of RMB can further broaden the channels of RMB investment and financing in the countries along the Belt and Road with the help of RMB offshore trading, a carrier of internal and external system circulation, and effectively regulate the issuance and pricing of RMB offshore through the formation of offshore borrowing, offshore credit and offshore bond markets, so as to strengthen RMB investment and financing support for the construction of the Belt and Road. In addition, the full product system of offshore RMB can be innovated to provide a mechanism for the release and recovery of offshore RMB liquidity for all kinds of high-quality assets in countries along the Belt and Road, break the monopoly of US dollar, and gradually strengthen the position of RMB in the hinterland of Eurasia. Editor/Xu Shengpeng