icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm
20 Jun, 2019 14:17

China could challenge US dollar’s dominance by globalizing the yuan – economist Jim O'Neill

China could challenge US dollar’s dominance by globalizing the yuan – economist Jim O'Neill

The “only way that can ever change” the supremacy of the US dollar as a global reserve currency is if there’s a genuine, “long-term alternative,” former chairman of Goldman Sachs Jim O’Neill said.

He told CNBC that China could consider expanding the role of its currency.

“Some people would say, of course, the ultimate weapon would be for China to start selling very large numbers of US bonds… but it would probably hurt, of course, the value of Chinese investments,” O’Neill said.

Also on rt.com Yuan the Conqueror: Chinese currency poised to become global heavyweight, economists say

According to him, a weak yuan will also reduce investor confidence. “I don’t think a renminbi [yuan – Ed.] ... devaluation makes a lot of sense at all,” he said.

China could also focus on the growing power of its consumers to strengthen its global position, O’Neill added. He noted that currently, domestic consumption makes up only 40 percent of Chinese GDP, compared to 70 percent in the United States.

Also on rt.com China on gold-buying spree amid global push to end US dollar dominance

“Over the next decade to 20 years, there’s no way the US consumer can continue to be the dominant share… of the US economy… Whereas for China to reach the BRIC-type dream… the Chinese consumers got to continue to rise,” he said.

O’Neill coined the term BRIC [currently BRICS – Ed.]. He predicted that the four emerging countries (Brazil, Russia, India, and China) were on their way to reshaping the world economy.

For more stories on economy & finance visit RT's business section