China is determined to pursue the internationalization of the renminbi on a market-oriented basis, and will closely watch the spillover effects of Japan's ultra-loose monetary policy, Yi Gang, a vice-governor of China's central bank, told Xinhua.

 

"It is the basic policy of the People's Bank of China to let the renminbi compete with US dollar or euro fairly in the international market," Yi said in an interview on the sidelines of the annual meeting of the World Economic Forum Saturday.

 

In the past, it was not allowed to use the renminbi in cross-border trade transactions and investments. "What we are doing now is nothing but remove discrimination against the renminbi and let it act just as other reserve currencies," he said.

 

On concerns about the potential rise of the Chinese currency, Yi said, "It is just natural that foreigners might have some concerns, but it is not our policy to specifically promote the renminbi, and I hope people of other countries can treat it with calm."

 

"Whether the pace of the internationalization is a little bit quicker or slower, it is always and completely the choice of the market," he added.

 

"I would be actually pleased to see people have more confidence in the renminbi and choose it over other currencies thanks to a more sophisticated market, better implementation of China's monetary policy, China's macroeconomic stability and social stability, and stronger rule of law," he said. 

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